In my experience, fibs work best when you try to combine them with the theory in which they were first observed - elliot waves. I say try because I have found elliot waves quite hard to read. I don't try to hard to get a correct wave count all the time, but when it is obvious it is obvious, and these situations work well. Try to look for impulse waves (5 waves) as these will more often be followed by a rally from a fib. Also, look for confluence. For example, if the move is 3 waves, put fibs from 1-4 and 2-4 and you may notice for example that the 38.2 of 1-4 is at the same level as the 50% of 2-4. If price forms a reversal in a shorter timeframe at this level and perhaps lines up with a trendline, pivot point or previously respected MA then it is a no brainer.
As to why they work, if you get very long term charts you will see they respected many many years ago. And you will also see these numbers respected in many aspects of nature, which shares striking similarities with the markets. I believe that there are right fibs and wrong fibs, ones that should be respected and ones that shouldn't. The wrong fibs are respected due to trader activity and only create small moves. But that is great, exploit it!
Thanks for your help. I already red about Elliot Waves. 5 on up trend and 3 on dountrend. But, sometimes there are some little waves, and when we are going to count, there are 7 or 5. But I never put attention on the convergence of waves and fibbos, but now i´m going to see that.
Thanks Depleo for your indicator.
It´s better to use daily or weekly pivot?
How do you find these levels for Eur/dolar? Your graphic is very smal and it´s not possible to read your indicators.
Thanks and a good, godd luck for everybody