My FIB Method (Part 3) Movement between Fib levels
The current price consolidation of the ES offers a good example of how price moves between the FIB levels. I use these levels to identify zones for potential reversals and targets.
In this example I would treat the FIB levels as resistance until they are broken. Once they are broken I treat them as support and look for price to move to the next FIB level. As the time zones increase
the significance and strength of the levels increase as well. Although I primarily use FIBs in my trading it should be noted that there is often confluence with the key moving averages
that I use as well. The 9em, 21ema and the 55sma. The movement of the market is difficult if not impossible to predict. This it is one way to focus on high probability areas to make trades, place stops and take profits.
In this example I would treat the FIB levels as resistance until they are broken. Once they are broken I treat them as support and look for price to move to the next FIB level. As the time zones increase
the significance and strength of the levels increase as well. Although I primarily use FIBs in my trading it should be noted that there is often confluence with the key moving averages
that I use as well. The 9em, 21ema and the 55sma. The movement of the market is difficult if not impossible to predict. This it is one way to focus on high probability areas to make trades, place stops and take profits.
Comment:
Here is an absolutely beautiful example of the price action I am looking for using my FIB methodology. BTC sold off from the ATH zone and found support above the 236 fib from the higher timeframe. BTC formed an almost perfect triangle base breakout pattern below the the 382 retracment then broke out to the 50 fib and then the 618 fib just as I describe above.
