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77  BraSTOL MYERS SQmBB(BMY): DAILY 65 60 55 50 45 40 35 30 BULLISH THREE DRIVES AT A nBONACCI RETRACEMENT SBigCharts.confi  J J fl S 0 N D 98 F fl fl J J fl S 0 D 99 F R i i I I I I must admit that this pattem is not exactly symmetrical. However, the three drives do stick out at you. They are distinct enough that this price action does qualify as a valid Three Drives pattem. As you can see, each drive completed at approximately the 1.618 projection of the previous drive. Also, the time between each drive was roughly one month.
 Although the third drive did extend slightly beyond this area, the 1.618 projection and the .618 retracement converged within a 1/2 of a point of each other. The 1.618 projection of the third drive was calculated at 45 7/16, which was very close to the .618 at 45 15/16. The stock reversed after slightly exceeding this area, bottoming at 44 1/16.1 have included the following candlestick chart to illustrate the price action in the potential reversal zone. S3 52 51 SO 49 48 47 46 45 44 BRISTOL MYERS SQUIBB (BMY): DAILY PRICE ACTION IN THE POTENTIAL REVERSAL ZONE .618® 4515/16 1.618® 45 7/16 Volume SBigCharts.coni  22 23 24 25 29 29 30 Oct 2 5 6 7 8 9 12 13 14 IS le 15 20 The bullish candlestick was substantial evidence of a valid reversal. Also, the stock closed above the potential reversal zone on the day it hit the entire area. Even if you waited a day for confirmation, the gap up on the open of the following days trading clearly validated the reversal. When a situation like this occurs, it is important to allow a greater stop loss limit in the trade. The stop loss could have been placed just past the .618 projection. If this set-up was not going to yield reversal, the .618
projection would most likely have been blown out. Since there were several harmonic projections converging in the area just above 45, the pattem would have been invalid, if the stock fell below 43. Also, a close below the entire potential reversal zone would have invalidated the set-up. Bearish Three Drives At a Major Fibonacci Retracement Similar to the other Three Drives set-ups that include a major Fibonacci number, this bearish pattem is very clear, as well. A stock often experiences resistance a major Fibonacci retracement, such as the .618 or .786. When a stock forms a Three Drives pattem at a major retracement, it frequently will yield some type of reversal.  bearish three drives at a major fibonacci retracement: sell at 3! The combination of the major Fibonacci number and the Three Drives is no coincidence. If a stock forms this set-up, you must respect the potential resistance and examine the price action closely. If a reversal occurs, it usually is quite significant. However, if a clear pattem
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