Discover the Secret of Quasimodo Pattern in Forex Trading

Jakarta, Pintu News – The Quasimodo (QM) pattern in Forex trading is one of the most reliable reversal patterns and often appears at the end of a strong trend. It can be found on all time frames and on a variety of assets, including forex, stocks, and commodities. It signals a potential reversal in market direction which can be very profitable for traders.

What is the Quasimodo Pattern?

The Quasimodo pattern is a chart formation that indicates market exhaustion and a possible trend reversal. It consists of three peaks and two valleys for the bearish version, and three valleys and two peaks for the bullish version. The second peak, called the head, is the highest in the bearish formation, while the second valley is the lowest in the bullish formation.

This pattern has psychological significance in trading as it signals the moment where the momentum of the existing trend starts to weaken. It indicates a change in market psychology, where market participants are hesitant to push the price past a certain level, thus leading to a trend reversal.

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Trading Strategy with the Quasimodo Pattern

In Forex trading, the Quasimodo pattern can be utilized to identify optimal entry and exit points. For bearish patterns, traders are advised to open a sell position as soon as the third peak is formed using the second valley as a take profit target and the head as a stop-loss target.

As for bullish patterns, a buy position can be opened as soon as the second shoulder appears. The ideal entry point is the higher valley, with the peak between the head and the right shoulder as the take profit target and the head as the stop-loss target.

Difference Between Quasimodo and Head and Shoulders Patterns

The Quasimodo and Head and Shoulders patterns are both reversal patterns, but they have significant differences. The Head and Shoulders pattern has a second valley that is at the same level as the first, while in the Quasimodo pattern, the second valley is lower.

A line called the ‘neckline’ is used to distinguish between these two patterns. If the neckline is horizontal, it indicates a Head and Shoulders pattern. If the line is slanted, it indicates a Quasimodo pattern. This distinction is important because it provides different entry and exit points for traders.

Conclusion

The Quasimodo pattern is a very useful tool in Forex trading as it provides a clear indication of a trend reversal. Traders who understand and can identify this pattern correctly can increase the effectiveness of their trading strategies and potential profits.

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Reference

• FXOpen. Quasimodo Trading Pattern. Accessed on August 21, 2025