What is Difference between Oil Fib Retracement and Oil Trading Fibonacci Extension?
How to use Oil Fib Retracement and Extension and the Difference between Oil Fib Retracement and Extension
Crude Oil Trading Fib Retracement Areas
Fibonacci retracement is drawn between 2 chart points but Fibonacci extension is drawn using 3 chart points.
Oil Trading Fibonacci Retracement Level example explained below where the oil trend is heading downwards between Chart point 1 and Chart point 2, then after the Chart point 2 the crude oil price retraces then it continues moving upward in the original upwards oil trend. Note that this Oil Fibo Retracement Levels indicator is drawn from Chart point 1 to Chart point 2 in the direction of the crude oil trend.
Oil Fib Retracement Levels - How to Draw Oil Trading Fib Retracement Zones
Oil Trading Fib Extension Levels
Fibonacci retracement is drawn between 2 chart points but Fibonacci extension is drawn using 3 chart points.
To draw these Oil Trading Fib Extension zones we wait until the crude oil price retracement is complete & the crude oil price starts to move in the original direction of the Oil Trading trend. Where the retracement reaches is used as chart point Three for Fibo extension.
The Oil Trading Fib Extension example explained below shows the 3 chart Points where the Oil Trading Fib Extension indicator is drawn, marked as chart point 1, 2 & 3. Chart point 1 is where the oil trend started, Chart point 2 is where the oil trend pulled back & retraced and Chart point 3 is where the retracement reached as shown and illustrated on Oil Trading Fib Extension example explained below.
Oil Fibonacci Extension Levels - How to Draw Oil Trading Fib Extension Levels
Please note where these Oil Trading Fib Extension levels are plotted - Oil Trading Fib Extension levels are plotted above the Oil Trading Fib Extension indicator, these are the points where a trader will place the takeprofit orders.
