Quasimodo Pattern | Advanced

Price Action Trading Concept 2024

The Quasimodo Pattern is also called Over & Under pattern. It is an advanced
price action trading concept in the trading industry.

The Quasimodo pattern is more than a confluence pattern or entry

technique than a trading strategy. It uses to confirm the trader’s bias.

If you combine this pattern with your trading strategy, it increases your
trading odds & boosts your confidence level. It helps you to make better
decisions on time as well.

For example, If you spot a Quasimodo pattern near a level of support or

resistance or with divergence, it increases the trader’s confidence or trading
probability.
Many supply & demand traders use this pattern to identify the strong
tradable zones. When they find the Quasimodo pattern with strong supply or
demand zones, they execute the trade with greater confidence. It provides a
great Risk Reward ratio potential as well.

Quasimodo pattern does not appear all the time, but when this happens,
traders should not ignore it. It is one of the most reliable and powerful
patterns to trade.

What Is Quasimodo Pattern in Forex?

Quasimodo Pattern is also called as OVER & UNDER Pattern. It is a reversal

pattern that is created after a significant obvious trend. When a series of
higher high, higher low, or lower high lower low is interrupted, Quasimodo
Pattern is created. It is a double-ended cheater strategy. It is used as an
intraday price turning point. So the Intraday traders can use it as an
advanced price action trading pattern.
Quasimodo is one of the most profitable chart patterns in the forex. It
repeats itself all the time. The key is to identify, and most importantly, react
to them, when the trading opportunity arises.

How do I trade Quasimodo?

Buy Trade Setup

 Price creates a low
 Price creates a high
 Price breach the low and creates a lower low
 Then price breach the high as well and forms a higher high
  Now place your pending order (Buy Limit) at QML(Quasimodo Line)
 When price comes back to the low your pending order will be triggered.
 Place your stop loss just below the MPL (Maximum Pain Level).

Here, a significant drop has occurred in the market. The market makes an
obvious high and low consecutively. Then after making a Lower low it shoot
up and breach the high to make a higher high.

The space between the QML and MPL considered as a strong demand
Quasimodo zone. When price back to the zone our buy limit is triggered and
look how beautifully price retraced from the QML level. It starts to go to our
preferable direction.

Our First TP is hit.

Second TP is also hit.

This trade had a great risk reward potential.

Sell Trade Setup

 Price creates a high

 Price creates a low
 Price breach the high and creates a higher high
 Then price breach the low as well and forms a lower low

 Now place your pending order (Sell Limit) at QML(Quasimodo Line) or

execute a sell trade with your pre-planned entry technique.
 When price comes back to the high your pending order will be triggered.
 Place your stop loss just above the last MPL.
Take Profit

Take your profit up to the next trouble area. Breached high or low should be
the minimum target area. 1:3 is a standard risk-reward ratio that can be
applied in this price action trading strategy.
Is Quasimodo Head & Shoulder Pattern?

Though Quasimodo looks like the Head & Shoulder Pattern, it is distinctive
from the typical Head & Shoulder Pattern.

Hope the sketch below makes sense to you.

So, all Quasimodo pattern is Head & Shoulder Pattern, but all Head &
Shoulder Patterns are not Quasimodo Pattern. To be a Quasimodo pattern, It
needs one extra “qualification” that required price to move beyond a
specified high or low to capture both buyers or sellers.
Is Quasimodo W/M Pattern?

The structure of Quasimodo consists of two engulfing, both up and

downsides. But the W/M formation consists of one engulfing up or downside.

Where Will Quasimodo Generally Appear?

Quasimodo pattern appears at all time frames. It occurs always after a

significant rally. Then the market is manipulated to create liquidity. Where
the retail traders are captured, the profitable trading opportunity is created
there. Quasimodo is very reliable if used properly and can be seen on every
timeframe from daily down to 1 min charts.
What Should Be Remember To Trade QM Efficiently?

 Always look for fresh Quasimodo Demand/Supply zones, which are not tested
yet.
 Make sure the distance between QML and MPL is not too high. If the distance
is so high, risk will be increased and the Risk Reward Ratio will be poor. So,
when the zone is small, the risk is also small and the expected reward is big.
 Never ignore level over level.
 QM is more powerful when an authentic opposite zone is engulfed.
You can enhance your day trading strategies using this price action pattern.

Bottom Line

Quasimodo or Over & Under Pattern is not one of the most popular patterns
among forex traders as it is a new entrant in the financial analysis sector in
the financial markets. Although new, it is one of the most reliable and
powerful patterns to trade. The Risk-Reward ratio potential of this reversal
pattern is also good.
Understanding the establishing trend is an important factor for forex trading.
Using the classical definition of higher highs and higher lows versus lower
lows and lower highs is the right step to follow. If you do so, you can easily
identify the Quasimodo pattern, even though you are a novice trader. No
Quasimodo pattern scanner or indicator is needed to look for it. Your nacked
eye is enough to spot Quasimodo Pattern in the chart and to boost up your
confidence to execute the trade efficiently. This confluence price action
pattern can flourish your overall supply and demand trading strategy.