How Do You Draw Fibo Expansion Levels on Downwards Trend?
How Do You Draw Fibo Expansion Levels on Downwards Trend?
We draw the Fibo Expansion indicator tool from chart point 1 to chart point 2 to chart point 3 as displayed on the Fibonacci expansion xauusd examples shown below. Remember we always plot this Fibo Expansion tool in the direction of the market trend. In the Fibo Expansion example shown below, can you figure what direction we have plotted it? That's right - downward direction.
As a trader you would also have used Fib Expansion area 100.0 %, just where the price reached as illustrated on the Fibo Expansion example shown below. That would have been a good takeprofit zone.
How Do You Draw Fib Expansion Levels on Downwards Trend?
From the Fib Expansion tool example above, after drawing this Fibo Expansion indicator tool there are two levels that are used to show the profit taking levels - these two Fib Expansion levels are represented as horizontal lines across the chart marked as 61.8 percent Fibo Expansion Level & 100% Fibo Expansion Level.
Interpretation of How Do I Draw Fibo Expansion Levels on Charts?
XAUUSD traders Fibonacci Expansion levels to estimate where the price move will reach. There are two commonly used Fib Expansion areas: 61.8 % Fib Expansion Level and 100% Fibonacci Expansion Levels - these fibonacci expansion levels are used for setting xauusd taking profit zones.
To draw Fibo Expansion levels on the chart we wait until the price retracement is complete & price begins heading in original direction of trend. Where the price pull back gets-to is used as point 3. Fib Expansion Indicator tool is drawn using three chart points as shown on the Fib expansion xauusd examples displayed below of how to draw the Fibo Expansion IndicatorTool.
The Fibo Expansion example shown below shows the 3 XAUUSD Chart Points where the Fibo Expansion technical indicator is drawn, marked as XAUUSD Chart point 1, Gold Chart point 2 and XAUUSD Chart point 3.
Gold Chart point 1 is where trend started, XAUUSD Chart point 2 is where price pulled back & retraced and Gold Chart point 3 is where retracement reached as highlighted on the Fibo Expansion Indicator Tool example shown below.
How Do You Draw Fib Expansion Levels on Downwards Trend?
Please note where these Fib Expansion zones are drawn - Fibo Expansion zones are drawn above the Fib technical indicator, these are the chart levels where a trader will set the take-profit orders using these Fib Expansion Levels - 61.8 % Fib Expansion Level & 100.0% Fib Expansion Level.
How Do I Draw Fib Expansion Levels on Downwards Trend?
