The red lines are just trend lines that I made dashed. It just looks cleaner than having a million fibs drawn all over the chart. Each pattern has different Fib Retraces. I just choose the fibs that are closest to each other in the PRZ (Price Reversal Zone). The closer the Fibs are to each other in the PRZ the likelihood is higher of it hitting that target. Hope that answered your question. If not feel free to ask again and I'll try to explain it better.
Thank you very much for your reply! As you state "Each pattern has different Fib Retraces".... Yes and this is the most important part for me - to find out about! Do you have any link, video or a book about statistics or rule of thumb about exactly this? Thank you in advance. BM
Yeah, there are some books I would recommend. Harmonic trading volumes 1 & 2 both by Scott Carney. Trade what you see by Larry Pesavento and Leslie Jouflas. The Gartley Trading Method by Ross L. Beck. Those should be enough to keep you busy for a while! Good Luck!
Great! Thanks! I will definitely check them out ... having a 14 days vacation from next week on ... and not able to trade. What a good investment in reading some books :) I will see if I can find them as e-books...that would be great. :) Thanks again! BM