Draw Fibonacci Projection Levels

XAUUSD Draw Fibo Projection Levels

Traders use Fibonacci projection levels to estimate where the trend movement will reach. There are two commonly used Fibonacci projection levels - 61.8% Fibonacci Projection Level and 100% Fibonacci Projection Levels, these fibonacci projection levels are used for setting xauusd take profit areas.

To draw Fibonacci Projection levels on xauusd chart we wait until the gold price retracement is complete & the price starts to move in original direction of the trend. Where the gold price retracement reaches is used as chart point 3. Fibonacci Projection XAUUSD Indicator is drawn using three chart points as shown on the Fibo projection gold trading example illustrated & shown below of how to draw the Fibonacci Projection Gold Indicator Tool.

The Fibonacci projection example shown below shows the 3 XAUUSD Chart Points where the Fibonacci projection gold indicator is drawn, marked as XAUUSD Chart point 1, XAUUSD Chart point 2 & XAUUSD Chart point 3.

XAUUSD Chart point 1 is where the xauusd trend started, XAUUSD Chart point 2 is where the xauusd trend pulled back & retraced and XAUUSD Chart point 3 is where the xauusd retracement reached as illustrated on the Fibonacci Projection Gold Indicator Tool example shown below.

XAUUSD Draw Fibo Projection Levels - Draw Fibonacci Projection Levels?

Please note where these Fibonacci Projection levels are plotted - Fibonacci Projection zones are plotted above the Fibo xauusd technical indicator, these are the chart points where a trader will set the gold take profit orders using these fibonacci Projection Levels - 61.8% and 100.0% Fibonacci Projection Levels.

Drawing Fibo Projection Zones on an Upwards Gold Trend

We use Fibo expansion areas to estimate where the market trend movement will get to. There are two commonly used Fibonacci projection levels: 61.8%Fibonacci Projection Level and 100% Fibonacci Projection Level, these Fibonacci Projection Levels are used for taking profit.

On the Fibonacci projection indicator example illustrated & 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 levels indicator is drawn upwards.

These Fibonacci projection levels are displayed as horizontal lines above the Fibonacci Projection gold trading technical indicator, showing xauusd profit taking areas. In the gold trading example illustrated & shown below if you as a trader had used of 100.0% Fibonacci projection level you would have made nice profit from the trade setup.

Drawing Fibonacci Projection Levels Gold Indicator on an Upward XAUUSD Trend

From the above Fibonacci projection indicator examples, the upwards trend continued & both 61.8% & 100.0% Fibonacci projection levels were all hit after which gold price retraced again after getting to the 100.00% Fibo Projection level.

Drawing Fibo Projection Levels on a Downwards Gold Trend

Since we use the Fibonacci projection indicator tool to estimate xauusd take profit levels, how do we draw Fibonacci Projection in a downward XAUUSD trend?

We draw the Fibonacci projection tool from chart point 1 to chart point 2 to chart point 3 as illustrated on the Fibonacci projection gold trading examples illustrated below. Remember we always plot this Fibonacci projection tool in the direction of the trend. In the Fibonacci projection example shown below, can you figure what direction we have plotted it? That's right - downwards direction.

Try & spot the difference between how we have drawn Fibonacci projection levels indicator above and how Fibonacci Projection levels indicator is drawn below. This time you would also have used Fibonacci projection level 100.0%, just where the price reached as illustrated on the Fibonacci projection levels gold trading example shown below. This would have been a good xauusd take profit area.

Drawing Fibonacci Projection Levels Gold Indicator on a Downward XAUUSD Trend

From the Fibonacci projection levels indicator example above, after drawing this Fibonacci projection levels xauusd tool there are 2 levels that are used to show the xauusd profit taking areas - these two Fibonacci projection levels are drawn as horizontal lines across the gold price chart marked as 61.8% XAUUSD Trading Fib Projection Level and 100% Fibonacci Projection Level.

Draw Fibo Projection Areas