This trading strategy is easy to use in forex trading as you will know where to make entry, where to put your stop loss and where to set you target profits.
The fibonacci also can be use to determine support and resistance. But in this lesson, we going to learn how to trade forex with using fibonacci retracement tools.
In order for you to use the fibonacci tools, you need to understand the market structure. Because that is the projection of your decision whether you want to go buy or you want to go sell.
By using the fibonacci retracement tools, you will know where to put the entry in retracement area.
What is Fibonacci Retracement
Fibonacci retracement level in forex technical analysis is the possibilities of the price make a retracement in market trending structure.
If we look at the market trend, the market structure are moving in high and low condition. If the market is uptrend, we wait for the market to make the retracement and we put entry buy on retracement area by using fibonacci retracement tools.
Look at the retracement area. The green area is the location that we are going to make entry by using fibonacci retracement tools.
In this case, we need to know what is the market trending structure,then we can decide whether we want to go buy or we want to go sell.
3 Fibonacci Retracement Levels
•There are 3 entry entry level of fibonacci retracement level.
•This entry level can be find using fibonacci tools.
•The entry level are :
–50.0 Enrty 1
–38.2 Entry 2
–23.6 Entry 3
Fibonacci Retracement Entry Level
By using the Fibonacci retracement tools, we can determine the entry level, stop loss and target profits.
161.8 Target Profit 2
100.0 Target Profit 1
50.0 Enrty 1
38.2 Entry 2
23.6 Entry 3
0.0 Stop loss
These are the area that you need to find in your Fibonacci level.
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