3 GREAT FIBONACCI INDICATORS
Fibonacci
theory
Price correction (retracement) is a short-term anti-trend
price movement. Prices almost never just rise during the uptrend and
fall during the downtrend. Even within the same trend, the price can
rise and then retrace for a while or vice versa. The most profitable
and less risky positions are positions opened at the end of the
retracement. It is therefore important to know how to define the levels
at which the trend will resume after a short retracement. Technical
analysis has the so called correction index which uses Fibonacci
numbers. The Fibonacci sequence is a series of numbers that takes the
previous number and adds it to the current number to get the next
number in the sequence. For example, 1, 1, 2, 3, 5, 8, 13, 21, 34, 55,
89, 144 etc.
These numbers possess an intriguing number of interrelationships, such
as the fact that any given number is approximately 1.618 times the
preceding number and any given number is approximately 0.618 times the
following number.
Experienced traders know that in a fast market, the correction is about
0.382 of the
price range movement. In a market with average price movements,
correction is about half the price range movement. Maximum correction
is 0.618,
which indicates that the trend is rather weak.
Zero percent is the considered as the peak of the crest of the move
while hundred percent is considered as the bottom most point of the
trough of the move. The trading signals are revealed by the Fibonacci
retracement zones or levels which are calculated at 23.6%, 38.2% and 50%.
Since it's mostly seen that history is continuously repeated when it
comes to the forex market, the Fibonacci methods prove be to be very
applicable over here. Thus, with these shapes, the forex traders are
not only able to predict the entire course of the market, they also end
up preventing worthless investments.
Indicator # 1 FIBO - AUTO
THIS WILL MAKE FIB LEVEL
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Indicator
# 2 FIBO
- DAY
Automatically draws Fibonacci
day's levels
Indicator #
3 FIBO
- RES-SUP
Automatically draws
Fibonacci Support / Resistance levels
