How to Draw Commodity Trading Fibonacci Extension

How Do I Use Commodity Trading Fib Extension Levels on Commodity Trading Chart?

We use Commodity Trading Fib Extension Areas to estimate where the trend movement will reach. There are 2 important Commodity Trading Fib Extension areas: 61.8% & 100% Commodity Trading Fib Extension Areas, these are used for taking profit.

To draw Commodity Trading Fib Extension levels on the commodity chart we wait until the commodity price retracement is complete & the price starts to move in the original direction of the Commodity Trading trend. Where the commodity price retracement reaches is used as chart point 3. Commodity Trading Fib Extension Technical Indicator is plotted using 3 chart points as shown on the commodities trading example illustrated and shown below of how to plot the Commodity Trading Fib Extension Technical Indicator.

The Commodity Trading Fib Extension example illustrated and shown below shows 3 Chart Points where the Commodity Trading Fib Extension technical indicator is plotted, marked as Chart point 1, Chart point 2 & Chart point 3.

Chart point 1 is where the commodity trend started, Chart point 2 is where the commodity trend pulled back & retraced and Chart point 3 is where the commodity retracement reached as displayed on the Commodity Trading Fib Extension Trading Indicator examples illustrated & shown below.

How to Trade With Commodity Trading Fib Extension - How to Draw Commodity Trading Fib Extension Levels on Commodity Trading Charts

Please note where these Commodity Trading Fib Extension areas are plotted - Commodity Trading Fib Extension levels are drawn above the Fibonacci technical indicator, these are the chart points where one will place takeprofit orders using these Commodity Trading Fib Extension Levels - 61.8% & 100.0% Commodity Trading Fib Extension Areas.

Drawing Commodities Fib Extension Levels on an Upwards Commodity Trading Trend

We use Commodity Trading Fib Extension Areas to estimate where the trend movement will reach. There are 2 important Commodity Trading Fib Extension areas: 61.8% Commodities Trading Fib Extension Level & 100% Commodity Trading Fib Extension Level, these Commodity Trading Fib Extension Areas are used for taking profit.

On the Commodity Trading Fib Extension indicator example illustrated and shown below you can see that the Commodity Trading Fib Extension tool is drawn along the direction of the trend, since the trend is upward - the Commodity Fibo Extension technical indicator is plotted upwards.

These Commodity Fibo Extension levels are shown as horizontal lines above the Commodity Trading Fib Extension technical indicator, showing the profit taking areas. In the commodities trading example illustrated and shown below if as a trader you had used of 100.0% Commodity Trading Fib Extension level you would have made a nice profit from the trade set-up.

Drawing Commodity Trading Fib Extension Trading Indicator on an Upwards Commodity Trend - Commodity Trading Fib Extension Trading Tool

From the above Commodity Trading Fib Extension indicator example, the upward trend continued and both 61.8% & 100.0% Commodity Trading Fib Extension levels were all hit after which commodity price retraced again after getting to the 100.00% Commodity Fibonacci Extension level.

Drawing Commodities Fib Extension Areas on a Downwards Commodities Trading Trend

Since we use the Commodity Trading Fib Extension indicator tool to estimate take profit levels, how do we draw Commodity Trading Fib Extension in a downwards Commodity Trading trend?

We draw the Commodity Trading Fib Extension tool from chart point 1 to chart point 2 to chart point Three as shown on the commodities trading example illustrated below. Remember we always draw this Commodity Trading Fib Extension tool in direction of the trend. In the Commodity Trading Fib Extension example illustrated and shown below, can you figure what is direction that we have drawn it? That's right - downwards direction.

Try & spot difference between how we have drawn Commodity Trading Fib Extension technical indicator above and how Commodity Trading Fib Extension technical indicator is plotted below. This time you would also have used Commodity Trading Fib Extension level 100.0%, just where the price reached as illustrated on the commodities trading example shown below. That would have been a good take profit area.

Drawing Commodity Trading Fibo Extension Technical Indicator on a Downward Commodity Trend - Commodity Trading Fib Extension Trading Tool

From the Commodity Trading Fib Extension indicator example above, after plotting this Commodity Trading Fib Extension tool there are 2 levels that are used to show profit taking areas, these 2 Commodity Trading Fib Extension areas are plotted represented as horizontal lines across the commodity price chart marked as 61.8% Commodity Trading Fib Extension Level & 100% Commodity Fibo Extension Level.