How Do I Draw Oil Fib Extension Levels?

How Do I Trade Oil Trading and Draw Oil Fib Extension Levels?

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

To draw Oil Trading Fib Extension levels on the crude oil chart we wait until the crude oil price retracement is complete and the crude oil price starts to move in original direction of the crude oil trend. Where the crude oil price retracement reaches is used as oil chart point 3. Oil Fib Extension Indicator is drawn using three oil chart points as shown on the Fib extension oil example explained below of how to draw the Oil Fib Extension Oil Trading Crude Oil Indicator.

The Fibonacci extension example explained below shows the 3 Crude Oil Chart Points where the Fibonacci extension oil indicator is drawn, marked as Crude Oil Trading Chart point 1, Crude Oil Trading Chart point 2 & Crude Oil Trading Chart point 3.

Crude Oil Chart point 1 is where the oil trend started, Crude Oil Trading Chart point 2 is where the oil trend pulled back and retraced and Crude Oil Chart point 3 is where the oil retracement reached as displayed on the Oil Fibo Extension Technical Indicator example explained below.

How Do You Draw Oil Fib Extension Levels? - How Do I Draw Oil Fib Extension Levels?

Please note where these Oil Fib Extension levels are plotted - Oil Trading Fib Extension levels are plotted above Fibo oil indicator, these are the crude oil chart points where a trader will set the oil take profit orders using these Oil Trading Fibo Extension Levels - 61.8% and 100.0% Oil Fibonacci Extension Levels.

Drawing Oil Fibonacci Extension Zones on an Upward Crude Oil Trading Trend

We use Fibo expansion areas to estimate where the oil trend movement will reach. There are two commonly used Fibonacci extension levels: 61.8% Oil Trading Fibo Extension Level and 100% Oil Fib Extension Level, these Oil Fibonacci Extension Levels are used for profit taking.

On the Fibonacci extension oil indicator example explained below you can see that the Fibonacci extension oil technical indicator is drawn along the direction of the oil trend, since the oil trend is upward - the Fibonacci extension levels oil indicator is drawn upwards.

These Fibo extension levels are displayed as horizontal lines above the Oil Fib Extension indicator, showing oil profit taking areas. In the oil example explained below if you had used of 100.0% Fibonacci extension level you would have made nice profit from the trade setup.

Drawing Oil Fib Extension Levels Indicator on an Upward Oil Trading Trend

From the above Fibonacci extension oil indicator examples, the upwards oil trend continued and both 61.8% & 100.00% Fibonacci extension levels were all hit after which crude oil price retraced again after getting to the 100.00% Oil Trading Fibonacci Extension level.

Drawing Oil Fibonacci Extension Areas on a Downwards Oil Trading Trend

Since we use the Fibonacci extension oil indicator tool to estimate oil take profit levels, how do we draw Oil Fibonacci Extension in a downward Oil Trading trend?

We draw the Fibonacci extension oil indicator tool from oil chart point 1 to oil chart point 2 to oil chart point 3 as shown on the Fibonacci extension oil example explained below. Remember we always plot this Fibonacci extension tool in the direction of the crude oil trend. In the Fibonacci extension example explained below, can you figure what direction we have plotted it? That's right - downward direction.

Try & spot the difference between how we have drawn Fibonacci extension levels oil indicator above and how Oil Fib Extension levels oil indicator is drawn below. This time you would also have used Fibonacci extension level 100.0%, just where the crude oil price reached as illustrated on the Fibonacci extension levels oil example explained below. This would have been a good oil take profit area.

Drawing Oil Fib Extension Levels Indicator on a Downward Oil Trading Trend

From the Fibonacci extension levels oil indicator example above, after drawing this Fibonacci extension levels oil tool there are 2 levels that are used to show the oil profit taking areas - these two Fibonacci extension levels are drawn as horizontal lines across the crude oil price chart marked as 61.8% Oil Trading Fibo Extension Level and 100% Oil Fib Extension Level.

How Do You Trade Oil Trading and Draw Oil Fib Extension Zones