Dragon pattern.
The classic pattern Dragon is used with certain rules, which are not observed in the work with crypto. More precisely, they are not mandatory to use.
Hump of the Dragon - correction of a downward movement has certain parameters for Fibonacci, namely to make the movement not greater than 0.5. This rule I do not use, as the Dragon is formed after impulse movements, which do not even closely fit these parameters, and they are not basic.
1. Fibonacci. The area of the second movement or the Dragon's leg should be in the OTE range. Fibonacci is the key criterion, because the Dragon is used only on the correction of growth with the goal of its continuation. If not bound to the Fibo, the zones above are more likely to break the figure, as there is often a void on the left after the impulse. What does it mean?
An example of the Dragon of interest.
An example of the Dragon, which I do not use.
2. The presence of divergence in the formation of the second leg. Most often I use the Dragon on 1h. timeframe. Therefore I want to see the divergence on the corresponding timeframe.
3. According to the rules - entry after breaking the neck. When I started seeing that the Dragon could move into the 3 drive pattern, I stopped waiting for a conservative entry and entered on the formation of the second leg.
4. Dragon can be used on any TF to enter in the presence of these factors.
5. Dragon is also used in reverse with the exact same structure. I do not use it. Why not? I have seen it often as a pattern of reversal of the initial movement, rather than the reversal of a local correction. Also, this pattern is often formed against the trend in the opposite direction, which reduces its working out.