What it is
The Cypher Pattern is a harmonic reversal pattern developed by Darren Oglesbee. It differs from Carney's patterns in its structure: point C extends beyond point A, and point D completes at the 78.6% retracement of XC (the full range from X to C).
The Cypher is popular among harmonic traders because of its frequency — it appears more often than Gartleys or Butterflies. The 78.6% of XC completion provides a precise reversal zone.
Unlike other harmonics where D relates back to XA, the Cypher measures D against XC, making the geometry distinct and the trading levels unique.
The psychology
The Cypher identifies a specific type of overextension and retracement. Point C extending beyond A shows strong momentum. The subsequent correction to 78.6% of the full XC range is where momentum exhausts.
The 78.6% retracement of XC is psychologically significant because it represents a nearly complete give-back of the C extension. Traders who bought the C breakout are now deeply underwater, and their capitulation fuels the reversal.
Cyphers work well because the C extension beyond A creates a clear structure that traders anchor to. When D retraces to 78.6% of that structure, the correction feels "complete" to market participants.
Identification
- 01XA impulse — Initial move
- 02AB retracement — 38.2–61.8% of XA
- 03C extends beyond A — Makes a higher high (bullish) or lower low (bearish)
- 04D completes at 78.6% of XC — The defining measurement
- 01BC = 127.2–141.4% of AB — Precise extension to C
- 02D lands on support/resistance — Structure confluence
- 03Reversal candle at D — Confirmation before entry
- 04Pattern appears frequently — More practice, more data
- 01C doesn't exceed A — Not a Cypher
- 02D doesn't reach 78.6% of XC — Incomplete pattern
- 03D exceeds X — Pattern may be morphing into something else
- 04No reversal at the completion zone — Failed pattern
Execution framework
Enter at point D when price reaches 78.6% of XC with a reversal signal. Limit orders at the precise level work well.
Below point X (bullish) or above point X (bearish). If D breaks X, the pattern has failed.
T1: Point A. T2: Point C. Extended: 38.2% of XC above C. Cyphers can produce strong reversals.
Typically 1:2 to 1:3 depending on the D-to-X distance.
Context matters
The Cypher is a good second harmonic to learn after the ABCD and Gartley. Its higher frequency means more trading opportunities but requires disciplined ratio verification.
- 01Precise 78.6% of XC completion
- 02Strong reversal candle at D
- 03C clearly exceeds A
- 04Structure confluence at D
- 01Sloppy ratio measurements
- 02D drifts past 78.6% without reacting
- 03Pattern against strong momentum
- 04C barely exceeds A (ambiguous)
The Cypher appears more frequently than most harmonics. Use this to your advantage — more patterns means more data for refining your harmonic trading edge.
Compare the full pattern set
Use the library to compare similar structures before deciding what the chart is actually building.