Fibonacci insights

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keep adjusting the Fib downwards.

and again...

...as this ' live-Fib ' is now closed as this wave count is finished - this is shown by the swing zig zag indicator having drawn a zig - this wave is so to speak sealed.

The only time we start moving this Fib tool again, is - if price will reach the ' Renvew Fib old INVALID ' targets - thus the case for either up or down.

...indicator and Fib Tool settings to follow shortly!

My best.

EDIT: Done! You will find them in post #1

I will for the future postings use new and up to date live charts, because it might have been a bit confusing for some of you when trying to understand all of this material while looking at ' old charts '.

I will be posting the following charts on a more regular basis:

- Cable, H1 and M1
- EURUSD H1

I will mark each post in the Title window so that you can easily identify what chart you are currently looking at. If need be I will put a short comment as well of course, but that should not be necessary at all, as all of this material is very easy to grasp and apply!

Are we all happy?

PS: still got to be thinking about this '1V' status thingy...

This was an ' up-Fib ' - we now draw and swap the fib tool around onto the last wave which is going to be a ' down-Fib ' now. (We plot the Fib tool onto the very wave that was responsible of reaching the 38.2 projection level, which is the so called ' Renew Fib old INVALID ' level on the chart).

This is now a live ' down-Fib ' - meaning: we will keep adjusting the tool downwards in case if price will make new lows. If no new lows were made, the swing will ' get sealed ' and as you know by now - to only touch and adjust this Fib again in case price reaches the INVALID level (-0.382) - up or down, either way.

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M1 - fiber

do you use Eliot waves in your fib trading?

Practical question: for example we open new clear H1 chart, drop ZigZag indicator on it then we need to place your fibo tool, so which ZigZag wave we have to select to draw initial fibo?

Thank you for your questions.

I do not use EW's per se. It makes matters to complicated, and there is really no need for that (Elliottitians out there, please don't shoot me for saying that! ) For sure, EW is a world by its own rights.

Nonetheless, I would use it more in a sense that, for instance, if I see that the wave responsible for 'taking out' the INVALID level is more of a corrective wave (meaning, a small swing/zig) that I would expect the probability to be high that we should have a deeper retracement, ie into the 78.6ish or so, on the next new live Fib.

Using simple logic and common sense works well. Work with Trend lines, Trend channels and Price Action.

Example: Deep/big retrace, and a 23.6 or 30.9 rejection - look for trades above/below the retrace swing etc. etc. / Double Tops, Double Bottoms, Higher Highs Higher Lows, Tea Cup formations etc. etc. etc.

RE: Initial Draw of Fib when opening new charts

The way to do it:

Zoom out of your charts look and locate a nice swing at/near the top or near/at the bottom - apply the Fib tool to that Price Swing (in other words: to that Zig) and work your way from there onwards using the INVALID level rules explained earlier on, to either: Swap-around/move and adjust up or down the Fib, until you get to your current valid live Fib Swing. Clear?

Yes, it's clear. I fact i understood it by myself yesterday - it's quite obvious.

So we have fibo in our chart and the rule of placing it is clear and without descrition - i like it

Will you explane the meaning of each fibo level and how you use it in trading?
Do you trade price patterns (actions) near certain levels, or you trade bounces or breakouts of that levels?

A word about the text labels used on the corresponding Fib levels:

There are so many levels - 32 of them actually - I could have just labeled them level I, II, III etc. etc. but that's not what I had in mind when creating this.

I tried to incorporate some ' logic ' to all of this Fibonacci stuff.

It's based on some simple facts and they are, among others, as follows:


1) Shallow retracements usually means the probability is a nice move in that direction.

1.1) However, if there is a bounce from a shallow retracement and price gets stuck somewhere early it gets ' rejected ' - the opposite is likely to take place.

2) A deep/high retracement, with price only coming back a little in the Fib direction that would mean or indicate a high probability for the market looking to reverse in the other direction.

2.1) And again, if the market does not reverse in the other direction - but gets stuck, it would mean that the trend is again in tact.

3) Usually a swing stemming from a deep retracements and making new highs/lows would mean that price will get stuck in early Fib-extensions - unless price retraces again a little and bounces off of a shallow level again, then -> rule 1/1.1 would/can/is play out again. You must apply logic and common sense.



All of it. This is the beauty of using Fibonacci, it's fluid and dynamic.

- Trade patterns, like teacupformations, V-Tops/Bottoms. Trend line breaks etc. etc. etc.

- Trade retracements, the way you might want to pursue is to take your usual lot size, split it into 2 or 3 sublots, and place those sub lots, one at a time, on various Fib Levels as price keeps retracing - Use this method for trading in both directions ie: in a down fib take shorts with the trend and once you see signs price has bottomed (ie higher highs higher lows swings) then start placing long trades. You will have to learn the significance of each Fib level - depending of what price has done already- such one level for instance will sometimes play a major role/importance, or, the very same level will have only a very small meaning - SCREEN TIME is the answer.

- Or, trade Break outs. You may want to use this Fib tool in conjunction with your existing method, or use it as a stand alone - You are an explorer, then Trader.

Anymore questions?

Cable M1 - up Fib

OK. Big price swings as shown in Fig. A and Fig. 1; draw another opposite (Live)-Fib as shown in Fig. 1.1 {plot a Fib in the opposite direction} -(the logic behind this being - something like this: on a big price move all orders should be satisfied thus the big move, therefore, the upcoming first retracement of such is to be/could be interpreted as a trend reversal; unless of course price does show/make reversal signes (early rejections on the opposite Fib)and is able yet again to make fresh high/lows.)-thus creating a Fib-Cluster as shown in: Fig. 2 and Fig. 2.1.

Also, you may want to do the same in case of a 'Projection B/C/D' - plot one (Live)-Fib onto the move/wave that is causing the reach of the 'Projection B/C/D Levels' whilst still keeping the old/previous Fib, showing the projections, in place.

You will see some price action between the 'old/previous' and the 'new live' Fib.

PS: I did say earlier on about not having to use Fib-Clusters, that is correct: However, the fact is you can get away with keeping it simple, nonetheless, in those two scenarios (big-swings and projections) you can add another Fib in order to see the opposite 'pulling force of the market'.

PPS: For your info: charts used in this example are - Cable M1.

This thread is considered closed now.

Wishing you well and good luck in your trading!


EDIT: Added Fib-Cluster examples in post #40.

Greetings folks!

This thread is open again, and any V-filter has been removed ; please, if you do have any questions or comments, now is the time to ask! The reason for re-opening this thread is, because I have had requests to do so. I will dedicate some more time - after which, as Jack B. would say: I'm going dark! simply because I MUST fully concentrate on my trading!!

...who's first?


PS: I have also re-written and re-uploaded the Fibonacci Retracement Tool Code-settings and instructions in post #1.

I just wanted to add my 2 cents to this discussion on fibs. Please see the attachments and i hope they will draw some lively discussion