How to Draw Indices Trading Fibonacci Expansion Indicator Tool on Stock Indexes Charts

How Do I Use Indices Trading Fibonacci Expansion Levels on Indices Chart?

We use Indices Trading Fibonacci Expansionlevels to estimate where the indices trend movement will reach. There are 2 important Indices Trading Fibonacci Expansion levels; 61.8% and 100% Indices Trading Fibonacci Expansion Levels, these are used for taking profit.

To draw Indices Trading Fibonacci Expansion levels on the stock indices chart we wait until the stock indexes price retracement is complete and the stock indexes price starts to move in the original direction of the Indices trend. Where the stock indexes price retracement reaches is used as chart point 3. Indices Trading Fibonacci Expansion Indicator is drawn using three chart points as shown on the stock indexes trading example explained and illustrated below of how to draw the Indices Trading Fibonacci Expansion Indicator Tool.

The Indices Trading Fibonacci Expansion example explained and illustrated below shows the 3 Chart Points where the Indices Trading Fibonacci Expansion indicator is drawn, marked as Chart point 1, Chart point 2 and Chart point 3.

Chart point 1 is where the indices trend started, Chart point 2 is where the indices trend pulled back and retraced and Chart point 3 is where the stock indices retracement reached as shown on the Indices Trading Fibonacci Expansion Indicator Tool example explained and illustrated below.

How To Trade With Indices Trading Fibonacci Expansion? - How to Draw Indices Trading Fibonacci Expansion Levels on Indices Charts

Please note where these Indices Trading Fibonacci Expansion levels are drawn - Indices Trading Fibonacci Expansion levels are drawn above the Fibonacci indicator, these are the chart points where a indices trader will set the take profit orders using these Indices Trading Fibonacci Expansion Levels - 61.8% and 100.0% Indices Trading Fibonacci Expansion Levels.

Drawing Indices Trading Fibonacci Expansion Levels on an Upward Indices Trend

We use Indices Trading Fibonacci Expansionlevels to estimate where the indices trend movement will reach. There are 2 important Indices Trading Fibonacci Expansion levels; 61.8% Indices Trading Fibonacci Expansion Level and 100% Indices Trading Fibonacci Expansion Level, these Indices Trading Fibonacci Expansion Levels are used for taking profit.

On the Indices Trading Fibonacci Expansion indicator example explained and illustrated below you can see that the Indices Trading Fibonacci Expansion indicator tool is drawn along the direction of the indices trend, since the indices trend is upwards - the Indices Trading Fibonacci Expansion indicator is drawn upwards.

These Indices Trading Fibonacci Expansion levels are displayed as horizontal lines above the Indices Trading Fibonacci Expansion indicator, showing profit taking areas. In the stock indexes trading example explained and illustrated below if you had used of 100.0% Indices Trading Fibonacci Expansion level you would have made nice profit from the trade setup.

Drawing Indices Trading Fibonacci Expansion Indicator on an Upward Indices Trend - Indices Trading Fibonacci Expansion Trading Tool

From the above Indices Trading Fibonacci Expansion indicator example, the upward indices trend continued and both 61.8% and 100.0% Indices Trading Fibonacci Expansion levels were all hit after which stock indexes price retraced again after getting to the 100.0 % Indices Trading Fibonacci Expansion level.

Drawing Indices Trading Fibonacci Expansion Levels on a Downward Indices Trend

Since we use the Indices Trading Fibonacci Expansion indicator tool to estimate take profit levels, how do we draw Indices Trading Fibonacci Expansion in a downward Indices trend?

We draw the Indices Trading Fibonacci Expansion indicator tool from chart point 1 to chart point 2 to chart point 3 as shown on the stock indexes trading example explained and illustrated below. Remember we always draw this Indices Trading Fibonacci Expansion tool in the direction of the indices trend. In the Indices Trading Fibonacci Expansion example explained and illustrated below, can you figure what direction we have drawn it? That is right - downward direction.

Try and spot the difference between how we have drawn Indices Trading Fibonacci Expansion indicator above and how Indices Trading Fibonacci Expansion indicator is drawn below. This time you would also have used Indices Trading Fibonacci Expansion level 100.0%, just where the stock indexes price reached as shown on the stock indexes trading example explained and illustrated below. That would have been a good take profit area.

Drawing Indices Trading Fibonacci Expansion Indicator on a Downward Indices Trend - Indices Trading Fibonacci Expansion Trading Tool

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