LESSON: $GBPNZD #fibonacci Strat. #forex $GBP $NZD #RBNZ #BOE
LESSON: $GBPNZD #fibonacci Strat. #forex $GBP $NZD #RBNZ #BOE
Friends,
Following is a quick review of a Fibonacci-based methodology I used to employ in trading. Please, consider following the actual trade with its original predictive/forecasting analysis at this link:
1 - FIRST and foremost, I make it a rule that my zero and 100 Fibonacci levels are confirmed by the existence of a point of repose, which has to be a minimum of 38.2%, as illustrated in the chart:
If a temporary retracement occurs at the 0.114 or the 0.214 levels (i.e.: mathematical complements of the 0.886 and 0.786 minor Fibonacci numbers), then the 100-Fib anchor cannot be defined at the level where these internal retracement, or contraction levels, occur.
2 - Next, I look for significant extensions. Keep in mind that there are several of these levels (i.e.: 1.131, 1.272, 1.313, 1.414 and 1.618).
HOWEVER, in the most common price actions, the 1.618 is the level at which a stop-loss can be sensibly defined.
PEARL: Now, remember that a lot of black-box or even institutional traders might already know this, so watch for an AGGRESSIVE market reversing at the 1.414 instead. Here, we are dealing with a standard level of retracement, namely at the 1.618 Fibonacci extension level, as illustrated in the following chart:
3 - Next, we are to define a probable level of contraction, or Fibonacci retracement from the current price swing. So, define the standard 0.382, 0.618 and 0.786 as the levels corresponding to vanishing probability levels of retracement, as illustrated in the chart:
Note how price in the LARGER Fibonacci matrix allows its 0.382 contraction level to align with the SMALLER (former) 0.618 level ... one being the mathematical complement of the other (i.e.: 0.382 + 0.618 = 1.000).
Is this making sense to you? Is this perhaps changing the way you might define your trading, stop-losses, or targets? If so, good. If not, feel free to share your thoughts in the thread.
Best,
David Alcindor
Predictive Analysis & Forecasting
Durango, Colorado - USA
-----
Twitter:
@4xforecaster
LinkedIn:
David Alcindor
-----
.
Friends,
Following is a quick review of a Fibonacci-based methodology I used to employ in trading. Please, consider following the actual trade with its original predictive/forecasting analysis at this link:
1 - FIRST and foremost, I make it a rule that my zero and 100 Fibonacci levels are confirmed by the existence of a point of repose, which has to be a minimum of 38.2%, as illustrated in the chart:
If a temporary retracement occurs at the 0.114 or the 0.214 levels (i.e.: mathematical complements of the 0.886 and 0.786 minor Fibonacci numbers), then the 100-Fib anchor cannot be defined at the level where these internal retracement, or contraction levels, occur.
2 - Next, I look for significant extensions. Keep in mind that there are several of these levels (i.e.: 1.131, 1.272, 1.313, 1.414 and 1.618).
HOWEVER, in the most common price actions, the 1.618 is the level at which a stop-loss can be sensibly defined.
PEARL: Now, remember that a lot of black-box or even institutional traders might already know this, so watch for an AGGRESSIVE market reversing at the 1.414 instead. Here, we are dealing with a standard level of retracement, namely at the 1.618 Fibonacci extension level, as illustrated in the following chart:
3 - Next, we are to define a probable level of contraction, or Fibonacci retracement from the current price swing. So, define the standard 0.382, 0.618 and 0.786 as the levels corresponding to vanishing probability levels of retracement, as illustrated in the chart:
Note how price in the LARGER Fibonacci matrix allows its 0.382 contraction level to align with the SMALLER (former) 0.618 level ... one being the mathematical complement of the other (i.e.: 0.382 + 0.618 = 1.000).
Is this making sense to you? Is this perhaps changing the way you might define your trading, stop-losses, or targets? If so, good. If not, feel free to share your thoughts in the thread.
Best,
David Alcindor
Predictive Analysis & Forecasting
Durango, Colorado - USA
-----
Twitter:
@4xforecaster
LinkedIn:
David Alcindor
-----
.
