How Do You Interpret Fibonacci Extension Levels on Indices Charts?
Stock Indices Trade Fibonacci Extension Levels on Indices Charts
To Calculate Fibo Extension levels on indices charts we use the Fib Extension Indicator
What are the Fibonacci Extension Levels in Indices Trading?
- 61.8% Fibo Extension Level
- 100% Fibonacci Extension Level
We use Fibonacci extension levels to estimate where the stock indices price movement will reach. There are 2 important fibonacci extension levels in indices trading; 61.8% and 100% Fibonacci Extension levels, these level are used for taking profit.
To draw Fibonacci extension levels indicatorwe use 3 stock chart points.
To draw Fibonacci extension levels on the indices charts we wait until the stock indices price retracement is complete and the indices instrument starts to move in the original direction of the Indices trend. Where the stock indices price retracement reaches is used as point 3.
The Fibonacci extension indicator stock indices trading example explained and illustrated below shows the 3 Indices Chart Points where the Fibonacci extension indicator is drawn, marked as stock chart points 1, 2 and 3. Indices Chart point 1 is where the stock indices price trend started, Indices Chart point 2 is where the stock indices price trend retraced and stock indices trading point 3 is where the stock indices price retracement reached as shown on the stock indices example illustrated below.
Fibonacci Extension Technical Indicator Analysis
The two Fibo extension levels 61.8% and 100% Fibonacci Extension levels were then drawn on the stock indices chart above the Fibonacci Extension Indicator as shown on the Fibonacci extension indicator stock indices trading example above.
How Do You Interpret Fibonacci Extension Levels on Indices Charts?
