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Fibs 101

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This topic contains 1,328 replies, has 58 voices, and was last updated by  Aariff Kadar 4 days ago.

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  • #29149

    Raj Vaid
    Participant
    • Topics: 2
    • Replies: 481

    Hi fellow traders, some were asking how they can use fibonacci in their trading. Let’s do this step by step as I have some time commitments. So I will add to this post, and if you have questions along the way, feel free to ask.

    Set up fib tool with the following levels (leave the presets in there, but get rid of 268 468 etc)
    0.786 = 786
    0.86 = 86
    -0.618 = 162
    -0.27 = 127
    -0.18 = 118

    Your fib should look like the one in the first attachment.

    I’ve included examples of swing trades. Have a look and I’ll post more on this subject later.

    Cheers.

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    #29210

    moaied suhail
    Participant
    • Topics: 1
    • Replies: 370

    looking forward

    #29287

    MUSTAZAH ABDUL RAHIM
    Spectator
    • Topics: 0
    • Replies: 5

    I’m looking forward..thanks for shating

    #29358

    Nicolaas Kolz
    Spectator
    • Topics: 0
    • Replies: 2

    This is pretty amazing!
    So you actually create waves from A-D. Really amazing.
    What I like is that you draw the initial line from a high to a low or low to high like I do on the normal fibo.
    I added like you said but don’t know exactly which ones to delete.
    Thanks

    #29374

    Raj Vaid
    Participant
    • Topics: 2
    • Replies: 481

    delete 1.618, 2.618 and 4.236

    #29404

    Raj Vaid
    Participant
    • Topics: 2
    • Replies: 481

    You have to plug in -0.618 instead of what the default says….this will give you the proper 162%

    #29662

    Raj Vaid
    Participant
    • Topics: 2
    • Replies: 481

    I took a trade on gbp/cad the other day that I’d like to share. My entry was not ideal as I thought that we were going to get a 618 bounce as there were two bullish candle formations at this level. Market decided to pull down to the 86 fib. This would have been the ideal entry. So if we had an 86 retrace, I targeted the 118 profit level. I am happy to report that today the market reached that level, and subsequently has pulled back.

    Cheers.

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    #29675

    Ashok Pandey
    Spectator
    • Topics: 0
    • Replies: 2

    Hi Raj,

    Thanks for sharing. I just wanted to know How you decide ABCD? Do you trade Elliot wave along with fibo? Thanks.

    #29744

    Raj Vaid
    Participant
    • Topics: 2
    • Replies: 481

    Hi Ashok, no Elliot wave doesn’t come into play with fibs. As far as where to start ABCD…well this explanation can get very complicated because it took me a long time to figure this out…..so let me put it into terms that you already know with respect to the BB strategy. When you get a daily CF , with BB breach, you can start your ABCD on 1hr, or 4hr chart then….basically it gives you optimal entry as the majority of time the daily CF will be tested.

    Then when point D is hit, you start your next swing….C becomes A, D becomnes B etc….see new swing for gbp/cad chart.

    Cheers

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    #29824

    Raj Vaid
    Participant
    • Topics: 2
    • Replies: 481

    As far as where to start the fibs, see these two gbp/cad charts – both 4hr. First one crunched to show you how to follow fibs, and the expanded one to show you latest AB swing.

    Hope this helps.

    Cheers

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    #30223

    Raj Vaid
    Participant
    • Topics: 2
    • Replies: 481

    So I had three reasons to short the other day
    1. 618 resistance
    2. Trendline
    3. past support acting as resistance now.

    Trade running just shy of 100 pips.

    Cheers

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    #31915

    marek herde
    Spectator
    • Topics: 0
    • Replies: 20

    I would like to discuss the way, we should plot Fibonacci line on some examples and i am curious about your answers.
    I have attached EUR/CAD example to explain what i mean.
    I have noticed, that when i plot my Fibonacci from the top to the bottom trend using very long upper or lower wick ( shown on the chart), The picture of the resistance or support of the candles to Fibonacci levels like 61.8 is not as precise. I did few tests to confirm that. Then i plotted it a bit different by switching to the line chart and plotted right on the top or the bottom of the candle.( when the actual body of the candle closes or opens. The result is quite different and precisely shows the exact point of the resistance without a gap.
    I noticed that, when the upper or lower wick is small, it doesn’t really matter, long wicks can affect the way we plan our TP or SL in case we use Fibo strategy. Here are the charts!

    https://charts.mql5.com/7/717/eurcadv-d1-atom8-financial-services-2.png
    https://charts.mql5.com/7/717/eurcadv-d1-atom8-financial-services-4.png
    To me, that little difference does matter πŸ™‚

    #31944

    Sebastian Brandt
    Participant
    • Topics: 0
    • Replies: 267

    Thank you market, looks interesting and I have to do further testing to see what works best.

    #33298

    Raj Vaid
    Participant
    • Topics: 2
    • Replies: 481

    382 and 618 are reciprical fibs…..they are the strongest support/resistance levels we have. Ive attached an example of a chart….you can see how the market respecvts these two levels.

    Cheers.

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    #34098

    Sebastian Brandt
    Participant
    • Topics: 0
    • Replies: 267

    Raj,
    or everybody else who might know it πŸ™‚

    Do you guys know a way we can switch between different Fibonacci settings? For example for novice traders who want to try both Fibonacci settings to “play around” and to see what fits them best.

    When I change the object settings it’s changed for every new Fibonacci.

    #34116

    TJ ‘
    Participant
    • Topics: 0
    • Replies: 83

    Hi Sebastian,
    This is a limitation of MT4, everytime you remove a value then you have to re-enter it when you want it back rather than being able to select different value with a check box for example.
    My work around, is that I keep all of them and when it’s too tight to clearly see the result, I use the scale function to make the chart clearer.
    I know that there is a way by playing with the ini file but I haven’t got any good result with that option.
    Good luck!

    #34144

    Sebastian Brandt
    Participant
    • Topics: 0
    • Replies: 267

    TJ,

    thanks for your feedback.

    So you added Raj’s levels (the minus level below zero) and you have the normal levels above 100% as well, right? Seems to be a good idea. I’ll try it.

    #34152

    TJ ‘
    Participant
    • Topics: 0
    • Replies: 83

    So you added Raj’s levels (the minus level below zero) and you have the normal levels above 100% as well,

    Exactly Sebastian.

    #34156

    Sebastian Brandt
    Participant
    • Topics: 0
    • Replies: 267

    Just tried that, looks very good, thanks for the good idea.

    I can now use both, the normal extensions, e.g. for engulfing candles and the “normal fib targets” Chris describes.

    And I can use Raj system, e.g. if I understand it correctly, we can use it for EUR/USD now:
    – currently retracement maybe up to 38.2?
    – extension up to 162%

    I’m still excited if the bat-pattern works πŸ™‚

    #34426

    marek herde
    Spectator
    • Topics: 0
    • Replies: 20

    Hi Rai πŸ™‚
    Could you please explain us what are these 86 and 786 levels mean?
    They seem to be so close to each other. Thank you very much!

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