How to Draw Commodity Fibo Extension on Down Commodity Trend

How Do You Draw Commodity Trading Fib Extension for Commodity Trading Downtrend?

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 shown below. Remember we always plot this Commodity Trading Fib Extension tool in the 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 - downward direction.

As a trader you would also have used Commodity Trading Fib Extension level 100.0%, just where the price reached as illustrated on the Commodity Trading Fib Extension example shown below. That would have been a good take profit area.

How to Draw Commodity Fibo Extension on Down Commodity Trading Trend

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

Explanation of How to Draw Commodity Fib Extension Levels on Commodity Trading Charts

We use Commodity Trading Fibo Extension Levels to estimate where the trend movement will reach. There are 2 commonly used Commodity Trading Fib Extension areas: 61.8% Commodity Trading Fib Extension Level and 100% Commodity Trading Fib Extension Levels, these are used for setting taking profit levels.

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

The Commodity Trading Fib Extension example illustrated and shown below shows 3 Chart Points where the Commodity Fibo 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 & Chart point 3 is where the commodity retracement reached as displayed on the Commodity Fibo Extension Technical Indicator examples illustrated & shown below.

How to Draw Commodity Trading Fibo Extension Technical Indicator on Downward Commodity Trading Trend

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