Topic: [GUIDE] Fibonacci Retracement (Read 193 times)
I found a video on Youtube about Fibonacci retracement. This man describes Fibonacci Retracement briefly: How To Use Fibonacci Retracement Technical Analysis To ID Bitcoin Bullish Bearish Support Resistance Hope this video would be helpful. I am also learning how its works.
Fibonacci Retracement brings obsession to inexperienced people on the market. You don't need to use Fibonacci in order to know where are ranges price will be bounced back.
Price charts give us all necessary things: consolidation of price, and volume spikes. You can use Fibonacci but I don't think it is too useful.
Price charts give us all necessary things: consolidation of price, and volume spikes. You can use Fibonacci but I don't think it is too useful.
I'm not sure if this is right but if I could remember what I read before about Fibonacci Retracement it's much better if you would use it to an uptrend or downtrend market to predict the possibility of the support and resistance? Am I right? or it's just one of its uses?
Yes it's not always perfect as the price sometime breaks out of the resistance or support levels but that's what stop losses are for, aren't they?
Support and resistance areas with Fibonacci retracement give more accurate results, but all these indicators should be used together and not separately.You must use several indicators so that they support each other.
Most technical analysis is based on price information, but price action trading is about looking at prices directly, typically as represented on candlestick charts.
Normally, prices tend to take charts and by analyzing these charts using technical analysis tools, we get a kind of prediction that helps us in making a decision. Again, they are tools that help to make decisions when there is uncertainty and do not mean a guaranteed profit.this tool is one of my references to get the purchase price. I like it best when the price enters the 50-61.8 area. in this situation usually the price will reverse direction, but indeed not all of these plans will work, sometimes the price will break through it quickly, therefore we can anticipate it with a cutloss at the boundary of the area we draw
However, using it with support and resistance levels and trading volumes gives good results in the medium and long term.that's just what we can do with Fibonacci, identifying the support and resistance from the lowest point to the peak. this is how i understood the indicator the basis of it is the golden ratio of 51 degrees. i personally think the indicator is not to be used in the 4hour chart but on a daily or longer.
there are tons of fibonacci indicators on tradingview though. which one do you recommend using?
Yes it's not always perfect as the price sometime breaks out of the resistance or support levels but that's what stop losses are for, aren't they?
Support and resistance areas with Fibonacci retracement give more accurate results, but all these indicators should be used together and not separately.You must use several indicators so that they support each other.
Most technical analysis is based on price information, but price action trading is about looking at prices directly, typically as represented on candlestick charts.
Normally, prices tend to take charts and by analyzing these charts using technical analysis tools, we get a kind of prediction that helps us in making a decision. Again, they are tools that help to make decisions when there is uncertainty and do not mean a guaranteed profit.this tool is one of my references to get the purchase price. I like it best when the price enters the 50-61.8 area. in this situation usually the price will reverse direction, but indeed not all of these plans will work, sometimes the price will break through it quickly, therefore we can anticipate it with a cutloss at the boundary of the area we draw
However, using it with support and resistance levels and trading volumes gives good results in the medium and long term.
Fibonacci retracement tool is one of my favorite trading tools. I tend to use it as classical support and resistances depending on the zone/price level I'm looking at. There's one thing to keep in mind those, Fibonacci retracement levels are used by plenty of traders which means that, at a point, those levels become self-fulfilling prophecies.
It's really convenient to see you copied your reply from Cindicator's blog written in 2019 and to make matters worse, it's verbatim. In the future, I would suggest you desist from such as it might lead you to either get tagged, temp or permanent banned.
https://blog.cindicator.com/how-to-read-price-action-in-cryptocurrency-markets/
~Snipped
It's really convenient to see you copied your reply from Cindicator's blog written in 2019 and to make matters worse, it's verbatim. In the future, I would suggest you desist from such as it might lead you to either get tagged, temp or permanent banned.
https://blog.cindicator.com/how-to-read-price-action-in-cryptocurrency-markets/
this tool is one of my references to get the purchase price. I like it best when the price enters the 50-61.8 area. in this situation usually the price will reverse direction, but indeed not all of these plans will work, sometimes the price will break through it quickly, therefore we can anticipate it with a cutloss at the boundary of the area we draw
If you’ve ever looked at technical analysis charts, you know how quickly it can get complicated. Moving averages, Fibonacci retracements, volume, volatility, indices, ratios.Yet most statistical indicators are trying to provide information about something which is already out there.let’s review what price action is and how to use it to forecast the short, medium, and long-term price movements of cryptocurrencies.
Price action is a method of analysing market price information to identify entry and exit trade opportunities. Essentially, it’s about how price behaves in trends in the short, medium, and long term. Most technical analysis is based on price information, but price action trading is about looking at prices directly, typically as represented on candlestick charts.
Price action is a method of analysing market price information to identify entry and exit trade opportunities. Essentially, it’s about how price behaves in trends in the short, medium, and long term. Most technical analysis is based on price information, but price action trading is about looking at prices directly, typically as represented on candlestick charts.
Limitations
Although it indicates where the price might find support or resistance, there is no certainty of that, so the price may reverse or bounce back. Therefore, it should be used in conjunction with other technical indicators and should not be relied upon entirely.
It's one of the my favorite tools in Technical Analysis which I used to help guide me when where to enter the market, take profit and where I can place my stop loss order.Although it indicates where the price might find support or resistance, there is no certainty of that, so the price may reverse or bounce back. Therefore, it should be used in conjunction with other technical indicators and should not be relied upon entirely.
Yes it's not always perfect as the price sometime breaks out of the resistance or support levels but that's what stop losses are for, aren't they?
Disclaimer: The information's contained in this explanation is the result of my understanding of Fibonacci Retracement and may contain some errors. Search and confirm about it.
Table of contents
1. What is Fibonacci retracement?
2. How to use Fibonacci retracement
3. The Difference Between Fibonacci Retracements and Fibonacci Extensions
4. Limitations
What is Fibonacci retracement?
We talked about in the last article Elliott Waves, and today we will start learning what you can expect when the market begins with a corrective phase, one of the most important tools that we will learn is how to use Fibonacci retracement.
It is about using Fibonacci ratios as percentages to predict areas of interest. These ratios are:
0%
23.6%
38.2%
61.8%
78.6%
100%
It is not fixed percentages, as percentages higher than 100% such as 261.8% or 423.6% can be used.
The important point that we will be looking for is 50%.
How to use Fibonacci retracement
If we take into account that the Fibonacci series are numbers
1, 1, 2, 3, 5, 8, 13, 21, 34, 55, etc.
If you divide a number by the number that follows it, you will get a percentage close to 0.61, and if we take the number that precedes it, we get 0.38, and thus it can be used to chart levels within the range if we put two important price points, and then this range is drawn according to the basic trend.
Hence some type of price movement is expected, either a reversal or a break.
Suppose the price rises from $20 to $35, and you want to draw the retracement indicator.
23.6% level will be (35- (15*0.236)) = $31.46
50% level will be (35- (15*.5)) = $27.5
61.8% level will be (35- (15*.618)) = $25.73
we can use it on charts as 5-wave move on the chart of the S&P 500 (Wave 2 flat. Wave 4 zigzag)
The Difference Between Fibonacci Retracements and Fibonacci Extensions
Fibonacci retracements apply percentages to a pullback
Fibonacci extensions apply percentages to a move in the trending direction
if the price rise from $5000 to $10,000 then back to 6000. the move from 10,000 to 6000 is retracements and rally to 14,000 is extension.
Limitations
Although it indicates where the price might find support or resistance, there is no certainty of that, so the price may reverse or bounce back. Therefore, it should be used in conjunction with other technical indicators and should not be relied upon entirely.
Sources
Code:
https://www.investopedia.com/terms/f/fibonacciretracement.asp
https://comparic.com/learn-apply-fibonacci-retracements-trading/
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