(C Form) -- start at the 12th fret
(A Form) -- start at the 3rd fret
(G Form) -- start at the 5th fret
(E Form) -- start at the 8th fret
(D Form) -- start at the 10th fret
You could use these basic forms to play in any key over the span of the guitar neck. Using the 'C' chord example above, you could derive 5 sets of finger patterns for the Major scale that roughly correspond to the positioning of these basic chord forms. Likewise, you can build other simple or more complex chords from the 5 basic chord forms. It mainly gives you a frame of reference when you play.Joe Pass discusses this system in his instructional books and videos. Check out the book, "Joe Pass -- on Guitar"
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