Here you can see the channel and when is the optimal short entry during the downtrend (ingoring the swing trading here). So, now we are fluctuating under -0.618 and above -0.764 level of this fib channel. Proactive shorts anticipating the price to break the supporting level should be avoided, shorting either at the test of a above level or wait for at least a daily candle to break down the supporing level (in this case -0.764) and close under it and enter short after we see a candle closed testing it from the other side (beneath it) (like drawn with red). This strategy gave great low risk entries! So, preliminary, should the scenario occur like in the original published idea, I am orientated to see at least 220 broken, retrace from 210s zone, and wait for the retrace when a daily candle closes touching it under it, probably in 230s. Then it is a great short opportunity and I follow the scenario. As long as it stays on the line level, still keeping the accumulated longs, with S/L at BE level.
This is the strategy of adding shorts during the downtrend, you can combine with cycles seen here: to trade some great swings during the downtrend. Once the scenario confirms, I will update the channel with next levels and targets to watch and also interesting possible swings and targets. Now you can zoom out and see the bigger picture of the idea.
Unfortunately, there are not enough fib channel lines to fullfill the whole channel and entries in this chart, also the 1 level of the fib channel had to be moved to another level, but it connects the tops from April and December 2013 .
ProwdClown, should you have any other questions regarding this strategy, don't hesitate to ask ;) :D
Commonsense would tell me the following statement: "So, now we are fluctuating under -0.618 and above -0.764 level of this fib channel" is referring to the bottom two lines on your live chart you published. I'm still learning "trade lingo." What do those numbers actually represent? Where would I find these numbers or how would I create the numbers on a chart? I suppose it is going to take time for me to learn those "values" as I use the knowledge base on creating charts.
Thanks again for the links for the knowledge base. Big help!!!
I will definitely check these out. As for now, I must take a nap for about 4.5 hours then get back to taxes.
Thanks again, Sir!
PS - I participated in the chat box for about an hour. Don't be surprised if you get more views.