Fibonacci Indicators are one of the most reliable indicators that a trader can use. In this video, I have explained different types of Fibonacci levels such as Forex Fibonacci retracement levels, fib extension levels. I have also covered which levels are more effectove than the others. Just tomention, 38.2% and 61.8% Fib levels are more effective than 50% fib level.
Fibonacci Retracement and extension levels have different use. Retracement levels can be used to primarily enter a trade. They can also be used to place a stop loss.
On the other hand Extension levels are either to take part of the profits or to close a trade.
Typically the Fib levels can be drawn on the chart using indicators available on the charting service a trader uses.
One other point I want to highlight that Fibonacci levels are very effective in all sort of markets such as Stock market, commodities, futures along with Forex.
Later in the video I have mentioned a very simple and effective forex trading strategy which is primarily based on fibonacci extension and retracement levels. You can use the strategy as early as tomorrow
Lastly, I mention some important points related to using Fibonacci. Such as Fib levels should not be used alone. They should always be used in conjunction with a supporting indicator such as candlesticks or Support & resistance levels.
The other important point is that these lines are very effective in all time frame charts. However as the timeframe goes higher, there effectiveness also increases. So, the fib levels drawn on 1 hr chart are more effective than fibonacci levels drawn on 15 min chart.
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