Commodity Retracement Strategy & Commodities Trading Retracement Trading for Upward Commodity Trend

How Do You Draw Commodities Trading Fib Retracement for Commodities Trading Uptrend?

The Fibonacci retracement indicator is placed on a commodity chart in an upward commodity trending market and this Commodity Trading Fibonacci Retracement indicator then calculates the retracement levels for the commodity upward trend on the commodity charts. Fibonacci retracement levels indicator is used by many traders as a commodity trading retracement trading indicator.

In the Commodity Trading Retracement Strategy example illustrated and shown below commodity price is moving up between chart point 1 & chart point 2 then after chart point 2 it retraces down to 50.0% retracement level then commodity price continues moving up in the original upward trend. Note that this commodity trading Fibonacci retracement technical indicator is plotted from point 1 to point 2 in direction of the Commodity trend (Upwards Direction).

Because we know this is just a retracement based on our commodity chart commodity trend - using this Fibonacci retracement indicator, we put a buy order just between the levels 38.2% and 50.0% retracement levels and our stop loss just below 61.8% retracement level. If you had put a buy at this point in the trade example shown below you would have made a lot of pips after the price retracement reached the Fibonacci 50.0% level and then continued moving in the original upwards trend.

How to Trade Commodity Price Retracement on Upwards Commodity Trend - Commodity Trading Fibo Retracement Levels Trading

Explanation for the Above Commodity Fibonacci Retracement Strategy Examples

Once the commodity price hit the 50.0% Fibonacci retracement level, this retracement level provided a lot of support for the commodity price, & afterwards the commodities market then resumed the original upward trend & continued to move upward.

23.60% Fibonacci retracement level provides minimum support and is not an ideal place to set a commodity trading order.

38.2% Fibonacci retracement level provides some support but commodity price in this example continued to retrace up to the 50% zone.

50.0% Fibo retracement level provides a lot of support & in this example, this was the ideal place to place a buy commodity trading order.

For this Commodity Trading Retracement Strategy example, the commodity price retracement reached the 50.0% Fibonacci retracement level, but most of the time the commodities trading market will retrace up to 38.2% Fib retracement level and therefore most of the time commodity traders set their buy limit orders at 38.2% Fib retracement level, while at same time placing a stop just below 61.8% Fib retracement level.