BAT-BTC, illustrating the usefulness of fibonacci
Quicky lesson article. One time I had a guy ask me to just give one example of Fibonacci working. This guy claimed to be a money manager or something like that. He said it was all hokus pokus. I showed him a chart with like a hundred examples. Never heard back from him.
So anyway point is they work. I won't go into the mathematical basis (because I'm stupid) but suffice to say that the levels are derived from a ratio that can be found in nature and can be seen from the way plants grow to the placement of the limbs on your body. Basically it is a repeating pattern that can be found almost anywhere.
So is it a surprise it can also be seen in price movement? This is where it gets interesting. Some people claim the levels work on price because of this property of being human derived and humans being a part of nature. I'm skeptical but one thing that can't be denied is that price react at fibb levels. Count em on the chart above. How many times did price reverse at fibb levels? A lot right? Whether support or resistance. I.E. Potential buy and sell targets. So why does that matter? It's just giving you another edge. If you're a reversal trader trying to catch a swing up. Getting a reversal formation at a fibb level is one more reason to enter a trade.
Quick lesson on Fibonacci. It is super easy to use. Simply click on the Fibonacci tool. Click the lowest point visible (assuming a swing up), then the highest high candle. The tool automatically shows you the levels. Traders then look for potential entries at these levels. Specifically the .5, .618, and .786 levels.
Anyway just a quick bit on Fibonacci. Remember like with any trade the more reasons you have to enter (confluent reasons) the better. Price reversing at a fibb level can be one signal of many that you can use to improve the probability of your trade.
So anyway point is they work. I won't go into the mathematical basis (because I'm stupid) but suffice to say that the levels are derived from a ratio that can be found in nature and can be seen from the way plants grow to the placement of the limbs on your body. Basically it is a repeating pattern that can be found almost anywhere.
So is it a surprise it can also be seen in price movement? This is where it gets interesting. Some people claim the levels work on price because of this property of being human derived and humans being a part of nature. I'm skeptical but one thing that can't be denied is that price react at fibb levels. Count em on the chart above. How many times did price reverse at fibb levels? A lot right? Whether support or resistance. I.E. Potential buy and sell targets. So why does that matter? It's just giving you another edge. If you're a reversal trader trying to catch a swing up. Getting a reversal formation at a fibb level is one more reason to enter a trade.
Quick lesson on Fibonacci. It is super easy to use. Simply click on the Fibonacci tool. Click the lowest point visible (assuming a swing up), then the highest high candle. The tool automatically shows you the levels. Traders then look for potential entries at these levels. Specifically the .5, .618, and .786 levels.
Anyway just a quick bit on Fibonacci. Remember like with any trade the more reasons you have to enter (confluent reasons) the better. Price reversing at a fibb level can be one signal of many that you can use to improve the probability of your trade.