How Do I Analyze Fibonacci Extension Levels on Forex Charts?

How Do You Trade Fibonacci Extension Levels on Forex Charts?

To Calculate Fibo Extension levels on forex charts we use the Fib Extension Indicator

What are the Fibonacci Extension Levels in Forex Trading?

• 61.8% Fibo Extension Level
• 100% Fibonacci Extension Level

We use Fibonacci extension levels to estimate where the price movement will reach. There are 2 important fibonacci extension levels in forex trading; 61.8% and 100% Fibonacci Extension levels, these level are used for taking profit.

To draw Fibonacci extension levels indicatorwe use 3 chart points.

To draw Fibonacci extension levels on the forex charts we wait until the forex price retracement is complete and the forex instrument starts to move in the original direction of the Forex trend. Where the forex price retracement reaches is used as point 3.

The Fibonacci extension indicator forex trading example below shows the 3 Forex Chart Points where the Fibonacci extension indicator is drawn, marked as chart point 1, 2 and 3. Forex Chart point 1 is where the price trend started, Forex Chart point 2 is where the price trend retraced and chart point 3 is where the price retracement reached as shown on the forex trading example below.

How Do You Interpret Fibonacci Extension Levels on Forex Charts?

The two Fibo extension levels 61.8% & 100% Fibonacci Extension levels were then drawn on the forex chart above the Fibonacci Extension Indicator as shown on the Fibonacci extension indicator forex trading example above.

How Do You Interpret Fibonacci Extension Levels on Forex Charts?