Fibo-only Trading

Hey folks,

greatings from Germany.

First of all, I am not sure if this "strategy" has been posted before, because all I learned was from this board.
But something striked my. Now I rely on this strategy and try (next to my Indicator strategy) so "indicate" intraday short moves (maybe also on daily and weekly basis possible)

Now, let me explain. I use a 5-15 Min chart, with a SMA 50 on it.

Rule 1: Trade ONLY in direction of the Trend...

Setup:

zoom out of you chart (in MT4 I use the second highest out-zoom factor ... can I call it this so? )

next, draw fibonacci lines with extensions for the last swing of at least 80 pips or so (for 15m chart)


Entry: Wait until price retraces to one fibo line and sell/buy (depends on trend!)
Exit: place first takeprofit of 50% of the trade a few pips under/above the next fibo in trend direction

Rule 2: Use a Stoploss!
Stoploss: place your stoploss in the near of the preceding fibo (so, the next fibo which is in the opposite trend direction)

Rule 3: No Trading when News are about to be released!

Rule 4: Use a maximum of 5% of your account on any trade (preferrably 2-3%)



Look at the chart to see what I tried to explain


Please leave constructive comments



Marc

You seem to have taken some long positions when there was no trend (1st half of the chart...)

hey ultfrisbee.
thank you for your reply.

you are absolutely correct. so sorry for that mistake.
i painted that chart too fast, i guess.

so the first trades would NOT have been clear/adequat signals!