Forex Trading Using Fibonacci..
Wednesday, 6 August 2008
What forex day trading signals do you use to enter and exit the market?
How do you know they will not give you a false signal entry?
How can you use these signals to quit your job?
Let's look first Fibonacci. This 750 years "natural order" of numbers reflects the birth of rabbits in a field, the number of crusts on a pineapple, the sequence of sunflower seeds. So how can we apply Forex Trading?
First, we must understand that Fibonacci is a marketed forex day trading signals indicator. The report given by the Fibonacci numbers are converted into a percentage. The Fibonacci sequence number is so 1,1,2,3,5,8,13,21,34,55133222 adding the number left to get the next number in the sequence. When we apply to our Fibonacci maps, we take a market shift from 50-100 points say and plot ratio Fibonacci.
This brings on the levels of potential support and resistance to our cards. The top of the move is regarded as "0%" of evolution and early passage is regarded as "100%". We then Fibonacci "Trace" levels of 23.6%, 38.2%, 50% and 68.1%. These "zones Trace" can give us signals exchange transactions.
If the price rose to 70 pips and then say traces can be said that the highest point Fibonacci resistance is at 23.6% and if the price is going to stop and reverse direction to return home after correction. If we break the 23.6% and 38.2% is the strongest resistance next level, 50%. If we have reached 23.6% resistance line and the "bounce" back down, we can start thinking whether it was just a correction - a Trace Fibonacci.
It is not enough to know the price has touched the line of resistance and if rebounded. We should also try to obtain an indication that the strength and market dynamics is also in favour of our theory. To do this, we could have a slow stochastic oscillator, a MACD and RSI as an example to give us an indication of the weight of our re-entry into the trade or late entry into the tracing idea.
You'd be surprised by the accuracy of the Fibonacci method of negotiation in terms of how history repeats itself again and again on the FOREX market. It is very tempting to get out of a trade when the price rotates in the opposite direction, but it should be Fibonacci using to make sure it is not a minor (23.6%) tracing and trade to run full course.
Labels: forex
posted by Master @ 03:44,