What it looks like
Five swing points X, A, B, C, D. After the first leg XA and a pullback to B, the move to C pushes beyond A, to 127 to 141% of the first leg. D then pulls back 78.6% of the whole move from X to C. Bullish: XA rises, C is a new high above A and D is a low. Bearish: XA falls, C is a new low below A and D is a high.
What it means
The swings have reached the point where the Cypher says the move should end, known as point D. It is a forecast made from proportions, not a sign that price has turned. Harmonic traders believe moves often stall at these Fibonacci proportions because many orders and profit targets gather there. Point D gives a precise place to act and a tight place to be proved wrong, which is the appeal of the pattern.
Bullish and bearish versions
How to trade it
- 1
Label X, A, B, C and D and check the ratios fit the Cypher.
- 2
Confirmation (optional but common): a candle that turns at D, such as a close back up from D for the bullish version.
- 3
Entry: buy near D for the bullish version, sell near D for the bearish.
- 4
Stop: just beyond D. Example on gold (bullish): X 4,000, A 4,060, B 4,030, C 4,080, D 4,017 (78.6% of X to C). Buy near 4,018 with a stop at 4,010, an 8 point risk. The last leg is about 63 points, so targets are about 4,041 (38%) and 4,056 (62%).
- 5
Targets: 38% and then 62% of the last leg (C to D), measured back from D.
A close beyond D: below D for the bullish version, above D for the bearish version.
Where it works best
On 15 minute to 4 hour charts in trending markets, where the push beyond A shows the earlier move still has strength.
WickSpeak finds bullish and bearish Cypher patterns automatically, measures the ratios for you and names the pattern on the candles that made it. The note says what it is, how to trade it near D and that a close beyond D proves it wrong. In Playbook you can use it as a condition in a play, alone or alongside other patterns and indicators (any of the 146 patterns can be a condition), and backtest it on past candles with your own costs.
Common mistakes
- Measuring D from the wrong leg; it is 78.6% of the whole move from X to C, not of XA.
- Taking a C that only reaches A, rather than pushing beyond it.
- Ignoring the trend; Cyphers that form against a strong trend are more fragile.
Related patterns
Questions traders ask
What are the Cypher pattern ratios?
C extends to 127 to 141% of the first leg, beyond A, and D completes at 78.6% of the whole move from X to C.
How is the Cypher different from a Gartley?
In a Gartley C stays inside A. In a Cypher C pushes beyond A, and D is measured against the X to C move.
Where do you enter a Cypher?
Near D at the 78.6% level, often after a candle turns there, with a stop just beyond D.
Are harmonic patterns reliable?
A harmonic pattern is a forecast made from proportions, not a sign that price has turned. That is why many traders wait for a candle to turn at D before entering. We do not quote win rates; backtest the pattern on your own market first.