Fibonacci Extension on Upward Forex Trend - How to Draw Fib Extension on Upward Forex Trend

Drawing Fibo Extension Zones on an Upwards Forex Trend - Draw Fibonacci Extension for Forex Uptrend

We use Fibonacci Extension levels to estimate where the trend movement will reach. There are 2 commonly used Fibo Extension areas: 61.80% Forex Fibo Extension Level and 100% Fibo Extension Level, these Fib Extension Levels are used for setting take profit areas.

On the Fibonacci Extension indicator example below you can see that the Fibonacci Extension technical indicator tool is drawn along the direction of the trend, since the trend is up - the Fibonacci Extension technical indicator is plotted upwards.

These Fibonacci Extension zones are displayed as horizontal lines above the Fib Extension technical indicator, showing profit-taking areas. In the forex trading example below if you had used of 100.0% Fibonacci Extension level you would have made good profit from using this setup.

How to Draw Fib Extension on Upward Forex Trend - How to Draw Fibonacci Extension on Up Forex Trend

From the above Fibonacci Extension indicator tool example, the upward trend continued and both 61.8% & 100.00% Fibo Extension zones were all hit after which the forex price retraced again after getting to the 100.00% Fibonacci Extension level.

From the Fibonacci Extension tool example above, after drawing this Fibonacci Extension tool there are 2 levels that are used to show the profit-taking areas, these 2 Fibonacci Extension levels are plotted as horizontal lines across the forex chart marked as 61.8% Forex Fibo Extension Level and 100% Fibonacci Extension Level.

Explanation of How to Draw Fibonacci Extension Levels on Forex Charts

We use Fibonacci Extension levels to estimate where the trend movement will reach. There are 2 important Fibo Extension areas: 61.8% & 100% Fibonacci Extension Levels, these are used for taking profit.

To draw Fibonacci Extension levels on the forex chart we wait until the price retracement is complete & the price starts to move in original direction of the Forex trend. Where the price retracement reaches is used as chart point 3. Fibonacci Extension Indicator is drawn using 3 chart points as illustrated on the example below of how to draw the Fibo Extension Technical Indicator Tool.

The Fibonacci Extension example below shows the 3 Chart Points where the Fibo Extension technical indicator is plotted, marked as Chart point 1, Chart point 2 & Chart point 3.

Chart point 1 is where the forex trend started, Chart point 2 is where the forex trend pulled back and retraced & Chart point 3 is where the forex retracement reached as displayed on the Fibonacci Extension Technical Indicator Tool example below.

How to Draw Fib Extension Indicator on Upwards Forex Trend

Please note where these Fibonacci Extension levels are plotted - Fibonacci Extension zones are plotted above the Fibonacci indicator, these are chart points where one will set takeprofit orders using these Fib Extension Levels - 61.80% and 100.00% Fibonacci Extension Levels.