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