How to Trade Retracement on Upward Oil Trading Trend

How Do You Draw Oil Trading Fib Retracement for Oil Trading Uptrend?

The Fibonacci retracement indicator is placed on a oil chart in an upward oil trending market and this Oil Trading Fibonacci Retracement indicator then calculates the retracement levels for the upward oil trend on the oil charts. Fibonacci retracement levels oil indicator is used by many oil traders as a oil trading retracement indicator.

In the Oil Trading Retracement Strategy example explained below the crude oil price is moving up between chart point 1 & chart point 2 then after chart point 2 it retraces down to 50.0% retracement level then crude oil price continues moving up in the original upward oil trend. Note that this oil trading Fibonacci retracement indicator is plotted from point 1 to point 2 in the direction of the oil trend (Upwards Direction).

Because we know this is just a retracement based on our chart oil trend - using this Fibonacci retracement indicator, we put a buy order just between the levels 38.2% and 50.0% retracement levels and our stop loss just below 61.8% retracement level. If you had put a buy at this point in the trade example explained below you would have made a lot of pips after the crude oil price retracement reached the Fibonacci 50.0% level and then continued moving in the original upward oil trend.

How to Trade Oil Trading Price Retracement on Upwards Oil Trend - Oil Fibonacci Retracement Levels Trading

Explanation for the Above Crude Oil Trading Fib Retracement Strategy Example

Once the crude oil price hit the 50.0% Fibonacci retracement level, this retracement level provided a lot of support for the oil price, & afterwards crude oil market then resumed the original upwards oil trend & continued to move up.

23.6% Fibo retracement level provides minimum support & isn't an ideal place to place a oil trading order.

38.2% Fibonacci retracement level provides some support but crude oil price in this example continued to retrace up to the 50% zone.

50.00% Fibonacci retracement level provides a lot of support and in this example, this was the ideal place to place a buy oil trading order.

For this Oil Trading Retracement Strategy example, the crude oil price retracement reached the 50.0% Fibonacci retracement level, but most of the time the crude oil market will retrace up to 38.2% Fibonacci retracement level and therefore most of the time oil traders set their buy limit oil orders at the 38.2% Fibonacci retracement level, while at the same time placing a stop just below 61.8% Fibonacci retracement level.