How Do I Draw Fibo Extension Levels on Upward Trading Trend?
How Do You Draw Fibo Extension Levels on Upward Trading Trend?
We use Fibo Expansion levels to estimate where the trend movement will reach. There are two commonly used Fibo Expansion zones: 61.8%Fibo Expansion Level and 100% Fibo Expansion Level, these Fib Extension Levels are used for setting take profit levels.
On the Fibo Expansion indicator example below you can see that the Fibo Expansion indicator tool is plotted along the direction of the trend, since the trend is up - the Fibo Expansion indicator is drawn upward.
These Fibo Expansion levels are displayed as horizontal lines above the Fib Expansion indicator, showing profit taking areas. In the trading example below if you had used of 100.0% Fibo Expansion level you would have made good profit from the trade set-up.
How Do I Draw Fib Extension Levels on Upwards Trend?
From the above Fibo Expansion indicator tool example, the upward trend continued & both 61.80% and 100.00% Fibo Expansion zones were all hit after which the price retraced again after getting to the 100.00% Fibo Expansion zone.
From the Fibo Expansion indicator tool examples above, after plotting this Fibo Expansion tool there are two levels that are used to show the taking profit areas, these two Fibo Expansion zones are plotted as horizontal lines across the chart marked as 61.8% Fibonacci Expansion Level & 100% Fibo Expansion Level.
Explanation of How Do You Draw Fib Extension Levels on Charts?
We use Fibo Expansion zones to estimate where the trend movement will reach. There are two important Fibo Expansion zones: 61.80% & 100% Fib Extension Levels, these are used for taking profit.
To draw Fibonacci Expansion levels on the chart we wait til the price retracement is complete and the price starts to move in original direction of trend. Where the price pullback reaches is used as chart point 3. Fibo Expansion Indicator is plotted using three chart points as illustrated on the Fib expansion trading example below of how to plot the Fibo Expansion Tool.
The Fibo Expansion example below shows the 3 Forex Chart Points where the Fibo Expansion indicator is plotted, labeled as Forex Chart point 1, FX Chart point 2 and Forex Chart point 3.
FX Chart point 1 is where trend started, Forex Chart point 2 is where trend pulled back & retraced and FX Chart point 3 is where retracement reached as portrayed on the Fibo Expansion Tool example below.
How Do I Draw Fibo Extension Levels on Upward Trading Trend?
Please note where these Fibo Expansion zones are plotted - Fibo Expansion levels are plotted above the Fibonacci indicator, these are the chart points where one will set takeprofit orders using these Fibo Extension Levels - 61.8% and 100.0% Fibo Expansion Levels.
How Do You Draw Fibo Extension Levels on Upward Trading Trend?
