Fibo Extension Strategy - Fibo Extension Strategy

We use Fibo Extension zones to project where the market trend movement will get to. There are two important Fib Extension zones: 61.80% and 100% Fibo Expansion Levels, these are used for taking profit.

To draw Fibonacci Extension levels in MetaTrader 4 chart we wait until the price retracement is complete & the price starts heading in original direction of trend. Where the price pullback gets-to is used as point 3. Fibo Extension Meta Trader 4 Indicator is plotted using three chart points as displayed on the example below of how to plot the Fibo Extension Indicator MT4 Tool.

The Fib Extension Meta Trader 4 Indicator example below shows the 3 Chart Points where the Fibo Extension Meta Trader 4 indicator is plotted, labeled as Point 1, Chart point two & Chart point 3.

Point 1 is where trend started, Point 2 is where trend pulled back & retraced and Chart point 3 is where the retracement reached as shown on the Fib Extension Meta Trader 4 Indicator Tool example below.

Fibo Extension Strategy - Fib Extension Strategy

Fibo Extension Strategy - Fib Extension Strategy

Please note where these Fibo Extension areas are drawn - Fibo Extension zones are plotted above the MT4 Fibonacci indicator, these are chart areas where one will set take-profit orders using these Fibo Expansion Levels - 61.80% & 100.00% Fibo Extension Levels.

Upward Trend - Fibo Strategy - Fibo Extension Strategy

We use Fib Extension zones to project where the market trend movement will get to. There are two important Fibo Extension zones: 61.80% Fibo Extension Level & 100% Fib Extension Level, these Fibo Expansion Levels are used for taking profit.

On the Fibo Extension Meta Trader 4 indicator example below you can see that the Fibo Extension Meta Trader 4 technical indicator tool is plotted along the direction of the trend, since the trend is upwards - MT4 Fibo Extension indicator is plotted up-wards.

These Fib Extension levels are displayed as horizontal lines above the Fibo Extension Meta Trader 4 indicator, showing profit booking zones. In the example below if you had used of 100.0% Fibo Extension zone the you'd have made good profit from the setup.

Up-wards Trend - Fibo Extension Strategy - Fibo Strategy - Fibo Extension Strategy

Fib Extension Strategy - Fibo Expansion Levels Strategy

From the above Fib Extension Meta Trader 4 indicator example, upwards trend continued and both 61.8% & 100.0% Fibo Extension levels were all hit after which price retraced again after getting to the 100.00% Fibo Extension zone.

Downwards Trend - Fibonacci Strategy

Since we use the Fibo Extension Meta Trader 4 tool to estimate take-profit levels, how do we draw Meta Trader 4 Fibo Extension in a downwards trend?

We draw the Fibo Extension Meta Trader 4 indicator tool from chart point 1 to chart point 2 to chart point 3 as shown on the example below. Remember we always draw this Fibo Extension MetaTrader 4 tool in direction of the trend. In the Fib Extension example below, can you figure what is direction that we have drawn it? That is right - downwards direction.

Try & identify the difference between how we have drawn Fibo Extension indicator above and how Fibonacci Extension indicator is plotted below. This time you'd also have used Fib Extension level 100.00%, just where the price reached as pictured on the example below. That would have been a good take-profit level.

Downwards Trend - Fibo Extension Strategy - Fibo Extension Strategy

Fibo Extension Strategy - Fib Expansion Levels Strategy

From the Fibo Extension Meta Trader 4 indicator examples above, after plotting this MetaTrader 4 Fibo Extension tool there are two levels that are used to show the taking profit zones, these 2 Fib Extension levels are plotted as horizontal lines across the price chart marked as 61.8% Fib Extension Level & 100% Fib Extension Level.