May 12, 2015 at 4:14 pm #34510
Hi Marek, they are fib support and resistance levels just like 382 or 618.May 13, 2015 at 2:13 am #34557
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iIf I understood it correctly from Raj explanations a retracement to 78.6 will often extend to 127%, whereas a retracement to 86% will often extend to 118%.
But somebody knows why some people use 78.6% and others seem to use 76.4% – I’ve read about both levels. I’m just wondering which levels is more reliable and why some people use the other level.May 13, 2015 at 3:33 am #34563
Thank Rai and Sebastian 🙂
I heard from very successful UK trader, that 78.6 and 86 levels are very important for big, major price movers like banks, hedge funds etc. Wonder why?May 13, 2015 at 9:08 am #34597
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78.6 and 86 levels are very important for big, major price movers
I know that those levels are very popular to trade harmonic patterns.May 13, 2015 at 11:36 am #34666
Fib convergences are beautiful things. See aussie chart….monthly down move hits its target, which is the 618 support level on the major upswing, and market tells you to go long on mnthly TF. Initially stalling at the 23.6 percent retrace (I always ignore this one). And while the market sits at another resistance at the moment, 90 percent of the time retraces go up to the 382 at minimum.
CheersMay 13, 2015 at 11:41 am #34668
Hey Raj and everyone,
Raj I tried to draw fibos the way you do today. I’m not entirely shure I understand it but can you give a quick look at the following chart and tell me if I did a good job or totaly bad job 😉 Thank you so much:
Here is my try on an uptrend:May 13, 2015 at 12:06 pm #34676
cheersMay 13, 2015 at 12:39 pm #34686
And here are my efforts for a downtrend, please halp if I’m doing this totaly wrong, or slightly wrong 😉 I’m really not shure of what I’m doing yet.May 13, 2015 at 12:42 pm #34689
Hehehe, thank you Raj, can you check the downtrend one 😀May 13, 2015 at 1:44 pm #34711
Hi Ivo, you don’t have a low yet (centre candle with two to the left and two to the right at higher prices than the centre candle) so can not pull that fib yet.
Ive attached bearish swings.
cheersMay 13, 2015 at 1:46 pm #34714
you can see that the daily 382 fib is acting as resistance right now on the chart!!
cheersMay 13, 2015 at 1:53 pm #34716
4hr swings on Aussie.May 13, 2015 at 2:25 pm #34724
May I ask the reason why we need to look for two candlesticks before and two after to plot the lowest or highest point please? If we have reversal candle of strong body, isn’t it enough to plot our Fibonacci then? Let me know please 🙂May 13, 2015 at 2:45 pm #34726
Hi Marek, I always plot fits from a high to a low and vice versa. And by definition a low has to have two candles to the right at higher price than centre candle. If you don’t have that and the next candle dips below, that means your fib swing is invalid and you don’t have a low at all. We have to have a mature swing so that the market has a chance to retrace properly. Having said that, if you don’t have a low on a daily chart yet, you might have it on the 4hr.
Hope this makes sense.May 13, 2015 at 3:14 pm #34731
Yes it does make sense. I am new to it and I don’t know this sort of subtle principles. Thanks for opening my eyes to it.
I am not confident with plotting Fibo on shorter time frames. I do sometimes plot resistance and support lines, but that’s about it. I will try though as a test. I am not sure, whether Fibo plotted on lower time frame can be treated seriously in relation to daily timeframe for instance. What do you think? I try to stay away from shorter time frames in general as it is not so reliable.
I have another question to you, if you could kindly answer please.
Do you use Fibonacci by plotting it on one engulfing candle which is part of the formed setup, or you only use Fibonacci for retracement measures and plot it on the previous wave? Thank you very much. I hope, I am clear with my last question 🙂May 13, 2015 at 4:25 pm #34753
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Thanks for this new way for trading with fib levels.Really appreciated.I think we have to draw fib levels in normal way when working with these levels that you suggested above.Once again thanks.May 13, 2015 at 4:34 pm #34759
Hi Marek, yes let’s stay away from lower TF, even though fibs work on all TF, but the larger the TF, the greater the fib supp/res levels. It’s good enough to keep your major daily fib swing on your charts as you get a clear picture of the retraces etc happening, and you know the fib supp/res on daily – you know that if the market is coming towards a fib level that something might happen, either to look for a CF to enter a trade or to take profits.
As far as pulling a fib on say a daily candle alone, well this really means you are doing it on the 1hr chart does it not? See example of Kiwi chart for the power of knowing the latest AB boundary on the daily chart.
Hope it’s clearMay 13, 2015 at 5:28 pm #34773
I meant something else. I was referring to Chris’s way of plotting Fibo on daily candle, which engulf previous candle on the strong setup. In that case 0% would be at the start of the candle in long setup and 100% on the top wick of that candle. Opposite to short setup. That way, you can establish some TP level without plotting it on the whole matured wave. Its just a another way of doing it, that’s all. To do it the way I explain, you would need to reset Fibo levels in properties though. Are you familiar with that technic? Its also effective according to Chris. Thank you 🙂May 13, 2015 at 5:57 pm #34781
The 162 per cent should roughly be the same either method.
But plotting fib on a single candle to me is the same as doing it on the 1hr chart….difference being that on the one hour chart you can watch the retracement and enter at a fib level for optimal entry.
Is this what you mean?May 13, 2015 at 6:14 pm #34785
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