How Do You Interpret Commodity Trading Fibo Projection Zones on Commodities Trading Charts?
How Do You Trade Commodity Trading Fibo Projection Zones on Commodity Trading Charts?
Fibonacci projection commodity technical technical indicator is drawn using 3 chart points.
To draw Fibonacci Projection levels we wait until the commodity price retracement is complete and commodity price starts to move in original direction of the trend. Where the commodity price retracement reaches is used as chart point 3.
The Fibonacci projection commodities trading example shown below shows the 3 Commodity Trading Chart Points where the Fibo projection commodity technical trading indicator is drawn, marked as Commodity Trade Chart point 1, 2 & 3. Commodity Chart point 1 is where the commodity trend started, Commodity Trading Chart point 2 is where the commodity trend pulled back and retraced & Commodity Chart point 3 is where the price retracement reached as shown on the Fib Projection Commodity Trading Tool commodities trading example shown below.
How Do You Interpret Commodity Trading Fibo Projection Zones on Commodity Trading Charts?
Please note where these Fib Projection levels are plotted - Fibo Projection zones are drawn above the Fibonacci Commodity Technical Indicator, these are points where the trader will set the commodity take-profit orders using these fibonacci Projection Levels - 61.8% and 100% Fibonacci Projection Levels.
Drawing Fibo Projection Zones on an Upward Commodities Trading Trend
We use Fibo projection levels to estimate where the trend movement will reach. There are Two important Fibonacci projection levels: 61.8% and 100% Fibonacci Projection Levels, these Fibonacci Projection Levels are used for setting commodity take profit areas.
On the Fibonacci projection commodities trading example shown below you can see that the Fibonacci projection technical indicator is drawn along the direction of the trend, since the trend is upward - the Fibonacci projection is drawn upward.
These Fibonacci projection areas are shown as horizontal lines above the Fibonacci Projection commodity technical technical technical indicator, showing profit taking areas. In the commodities trading example shown below if you had used of 100% Fibonacci projection you would have made nice commodity trading profit from the commodity trade setup.
Drawing Fib Projection Zones on an Upward Commodity Trading Trend - Fib Projection Strategies in Commodity Trading
From the above Fibonacci projection commodity trading examples, the upward trend continued & both 61.80% & 100.00% Fibonacci projection levels were all hit after which commodity price retraced again after getting to the 100.0% Fibo Projection level.
Drawing Fib Projection Levels on a Downwards Commodities Trading Trend
Since we use this Fibonacci projection tool to estimate commodity take profit levels, how do we draw it in a downward Commodity Trading trend?
We draw the Fibonacci projection indicator from chart point 1 to 2 to 3 as shown below. Remember we always plot this Fibonacci projection tool in the direction of the trend. In the Fibonacci projection commodities trading example shown below, can you figure what direction we have drawn it? - downwards direction.
Try & spot difference between how we have drawn Fibonacci projection above and how Fibonacci Projection is drawn below. This time you would also have used Fibonacci projection level 100%, just where the price reached as illustrated on the commodities trading example shown below. That would have been a nice commodity take profit area.
Drawing Fib Projection Levels on a Downward Commodity Trading Trend - Fib Projection Strategies in Commodity Trading
From the Fibonacci projection commodities trading example above, after drawing this Fibonacci projection commodity trading tool there are two levels which are used to show the commodity profit taking areas, these two Fibonacci projection commodity levels are drawn as horizontal lines across the commodities trading chart.
How Do I Trade Commodity Trading Fibo Projection Zones on Commodity Trading Charts
