Crab

The Pattern

The Crab, another of Scott Carney’s patterns, is the most extended structure in the family. D completes at a 1.618 extension of the X-to-A leg, reached through a very long C-to-D projection of 2.618 to 3.618 of BC. The B point retraces a moderate 0.382 to 0.618 of XA.

The result is a deep, dramatic overshoot far beyond the origin before the turn.

The Idea Behind It

The Crab is built for the kind of blow-off where price stretches well past any reasonable target and then reverses hard. The far-away completion gives a precise level to fade, and the reversal from a true Crab is often the sharpest of any harmonic pattern.

When It Tends To Work

It works on capitulation moves: a spike into the 1.618 extension that exhausts and reverses. Because the completion is so far out, the stop beyond it is well-defined and the snap-back can cover a lot of ground.

When It Tends To Fail

The Crab asks you to fade an already-violent move, which is exactly when trends can keep accelerating. A Crab that does not turn leaves you short a runaway rally or long a falling knife. It needs a hard stop and the discipline to take it.

How This Strategy Trades It

On a completed Crab, the strategy enters at the close of the confirming bar against the overshoot, targets a 0.618 retracement of the structure, and stops just beyond D. The shared entry and exit logic is on the Harmonic Patterns family page.

What The Backtest Says

The Crab fires rarely and its results are mostly negative across the samples below. Fading deep overshoots mechanically, without regard for momentum, is hard, and the numbers reflect that. It is a memorable shape with a difficult edge.