How to Draw Fibonacci Extension Levels on Upward Indices Trend

How Do I Trade Indices and Draw Fibonacci Extension Levels on Upward Indices Trend?

We use Fibonacci Extension levels to estimate where the trend movement will reach. There are 2 oftenly used Fibonacci Extension levels: 61.80% Indices Fibonacci Extension Level and 100% Fib Extension Level, these Fibonacci Extension Levels are used for setting indices take profit levels.

On the Fibonacci Extension indicator examples explained below you can see that the Fibonacci Extension technical indicator is plotted along the direction of the trend, since the trend is up - the Fib Extension technical indicator is drawn upwards.

These Fibonacci Extension zones are displayed as horizontal lines above the Fibonacci Extension indicator, showing indices profit taking areas. In the indices example explained below if you had used the 100.00% Fibonacci Extension level you would have made good profit from using this setup.

How to Draw Fibo Extension Levels on Upward Indices Trend?

From the above Fibonacci Extension indicator tool example, the upward trend continued and both 61.8% and 100.00% Fibonacci Extension zones were all hit after which the stock indices price retraced again after getting to the 100.00% Fibonacci Extension level.

From the Fibonacci Extension indicator tool example above, after plotting this Fibonacci Extension tool there are 2 levels that are used to show the indices profit taking areas, these two Fibonacci Extension levels are drawn as horizontal lines across the stock indices chart marked as 61.8% Indices Trading Fib Extension Level and 100% Fibonacci Extension Level.

Explanation of How Do I Draw Fibonacci Extension Levels on Stock Indices Charts?

We use Fibonacci Extension Levels to estimate where the market trend movement will reach. There are Two important Fib Extension levels: 61.80% and 100% Fibonacci Extension Levels, these are used for taking profit.

To draw Fibonacci Extension levels on the stock indices chart we wait until the stock indices price retracement is complete and the stock indices price starts to move in original direction of the Indices trend. Where the stock indices price retracement reaches is used as chart point 3. Fibonacci Extension Indicator is plotted using three chart points as illustrated on the Fibonacci extension indices example explained below of how to plot the Fibonacci Extension Technical Indicator.

The Fibonacci Extension example explained and illustrated below shows the 3 Stock Indices Chart Points where the Fibo Extension technical indicator is drawn, marked as Stock Indices Chart point 1, Stock Indices Chart point 2 & Stock Indices Chart point 3.

Stock Indices Chart point 1 is where the indices trend started, Stock Indices Chart point 2 is where the indices trend pulled back & retraced and Stock Indices Chart point 3 is where the indices retracement reached as displayed on the Fibonacci Extension Indicator examples explained & illustrated below.

How Do You Trade Indices and Draw Fibonacci Extension Levels on Upward Indices Trend?

Please note where these Fibo Extension areas are drawn - Fibonacci Extension zones are plotted above the Fibo indices indicator, these are the stock chart points where a trader will place the indices take profit orders using these Fib Extension Levels - 61.8% and 100.0% Fibonacci Extension Areas.

How to Draw Fibo Extension Levels on Upward Indices Trend