Research Shows That Trading Harmonic Pattern Could Improve IQ. German 40 IndexFUSIONMARKETS:GER40HenryDGREATFXHey everyone, in this video, I broke down a fantastic trading setup on the EUR/USD pair using harmonic patterns. I love trading harmonics because it constantly challenges your IQ and makes you a smarter, more analytical trader. I focused on my three-step framework that I apply to any pair: Key Level: First, I identified a crucial order block on the higher time frame (weekly). This is our potential reversal zone. Harmonic Pattern: Next, I moved to the 4-hour and daily charts to find a harmonic pattern aligned with that key level. I found a beautiful bearish Butterfly pattern. It's crucial to match the pattern with the trend—since the overall structure was bullish, we looked for an extension pattern (like the Butterfly) into the key level, not a retracement pattern. Liquidity Sweep & Entry: The final step was confirming the setup. We waited for a liquidity sweep (a break of the Previous Daily High - PDH) and then a close below a key bullish candle. Entry is on the retest of that break, with a stop loss placed just above the key level. I showed how the Fibonacci measurements (the 1.272 and 2.0 extensions) converged perfectly in the Potential Reversal Zone (PRZ), making it a high-probability trade. We also discussed profit targets and how to manage the trade by moving stop losses to maximize profits. This exact same process is what I've used successfully on pairs like GBP/JPY, USD/JPY, and indices like the German 40. It's a structured, repeatable method that filters out market noise. If you have any questions, drop them in the comments below! Don't forget to like, subscribe, and watch out for more videos like this. Happy trading!