How to Interpret the Difference between Fibonacci Retracement Levels and Fibonacci Extension Levels in Indices Trading
Indices Trade the Difference between Fibonacci Retracement Levels and Fibonacci Extension Levels in Indices Trading
Fibonacci Retracement Levels in Indices Trading
Fibo retracement is drawn between 2 stock chart points but Fibo extension is plotted using Three stock chart points.
Fibonacci Retracement Level stock indices trading example explained and illustrated below where the indices trend is moving down between Indices Chart point 1 and Indices Chart point 2, then after Indices Chart point 2 the stock indices price retraces then it continues heading upwards in the original upward stock indices trend. Note that this Fibonacci Retracement Levels indicator is drawn from Indices Chart point 1 to Indices Chart point 2 in direction of the stock indices trend.
Fibo Retracement Levels - How Do I Draw Fibonacci Retracement Levels
Fibonacci Extension Levels in Indices Trading
Fibo retracement is drawn between 2 stock chart points but Fibo extension is plotted using Three stock chart points.
To draw these Fibo Extension levels 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 stock chart point 3 for fibonacci extension in stock indices trading.
The Fibonacci Extension stock indices trading example explained and illustrated below shows the 3 stock 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 indices trend started, Indices Chart point 2 is where the indices trend pulled back & retraced and Indices Chart point 3 is where the stock indices price retracement reached as shown on the Fibonacci Extension stock indices example illustrated below.
Fibo Extension Levels - How Do You Draw Fibonacci Extension Zones
Please note where these Fibo Extension areas are plotted - Fibonacci Extension zones are drawn above the Fibo Extension indicator, these are the points where a trader will set the indices take profit orders.
How to Analyze the Difference between Fibonacci Retracement Levels and Fibonacci Extension Levels in Indices Trading
