Use time frame of M15 to determine the lower and the higher price of yesterday, because it's more precise.
Tip: Some traders use the Fibonacci in the wrong way.
The Fibonacci retracement is VALID only if the price movements on daily basis, it should be between lower and highest price of that day.
Thursday's historic (26[SUP]th[/SUP] of July 2012).
Open: 1,5499
High: 1,5724
Low: 1,5471
Close: 1,5688
Function = (High - (High - Low)) * 38%.
The market will indicate a Bullish opportunity on level of: (Low + (Function / 100)) = 1.5665 (+Spread).
Pivot Point (1) = (High + Low + Close) / 3 = 1.5628.
Pivot Point (2) = (High + Low + 2 * Close) / 4 = 1.5643.
If the price closes below 1.5643 or/and 1.5630, the market will indicate a bearish opportunity on the level of 1.5628 (-Spread).
[h=3]Take Profit Formulas:[/h]
Sometimes it seems that the market doesn't follow our forecast, therefore in order to get out spank from the market before losing your profit.
Then you have to calculate the market movements.
Market Movements = (High / (High + Low)) * 100
Market Movements = (1.5724 / (1.5724 + 1.5471)) * 100
Market Movements = 50.40
[h=3]Trading Recommendations:[/h]
According to the previous events, the price has still been trapped between 1.5430 and 1.5803.
• Buy above 1.5668 (78% of Fibonacci retracement levels) with a first target of 1.5748, it might resume to 1.5784.
• Below 1.5627 (61.8% of Fibonacci retracement levels), look for further downside with 1.5533 and 1.5475 targets.
[h=3]Technical Levels:[/h]R3: 1,6037
R2: 1,5881
R1: 1,5784
PP: 1,5628
S1: 1,5531
S2: 1,5375
S3: 1,5278
Chart Tools:
• It should be noted that the market was very stable and the trend was also very clear (upward).
• Range was: 253 pips (downward).
• The value of 50% Fibonacci retracement levels is: (High + Low) / 2 = 1.5598. (The key level to confirm a bullish market).
• Volatility is 394.62 so the market has called for a high volatile.
[h=3]Observation (s):[/h]
• Use historic prices to determine the future prices.
• Fibonacci retracement uses to determine accurate psychology level of support and resistance, and playing according to in this kind of period.
• Fibonacci is in a range trader (it is looks like the trend is trapping and going up or down, if you sell or buy for a long term in this period you'll go sure for losing your profit.
[h=3]Warning (s):[/h]
The material has been provided by Instaforex Company - instaforex.com
Tip: Some traders use the Fibonacci in the wrong way.
The Fibonacci retracement is VALID only if the price movements on daily basis, it should be between lower and highest price of that day.
Thursday's historic (26[SUP]th[/SUP] of July 2012).
Open: 1,5499
High: 1,5724
Low: 1,5471
Close: 1,5688
Function = (High - (High - Low)) * 38%.
The market will indicate a Bullish opportunity on level of: (Low + (Function / 100)) = 1.5665 (+Spread).
Pivot Point (1) = (High + Low + Close) / 3 = 1.5628.
Pivot Point (2) = (High + Low + 2 * Close) / 4 = 1.5643.
If the price closes below 1.5643 or/and 1.5630, the market will indicate a bearish opportunity on the level of 1.5628 (-Spread).
[h=3]Take Profit Formulas:[/h]
Sometimes it seems that the market doesn't follow our forecast, therefore in order to get out spank from the market before losing your profit.
Then you have to calculate the market movements.
Market Movements = (High / (High + Low)) * 100
- • If market movements is between 50.20 and 50.40, so it should close your position after 1H:30M (Around 40pips to 60pips). • If market movements is between 50.40 and 50.60, so it should close your position after 3H:15M (Around 80 pips to 120 pips).
• If market movements is between 50.60 and 50.99, so it should close your position after 8H:00M (Around 140 pips to 200 pips).
Market Movements = (1.5724 / (1.5724 + 1.5471)) * 100
Market Movements = 50.40
[h=3]Trading Recommendations:[/h]
According to the previous events, the price has still been trapped between 1.5430 and 1.5803.
• Buy above 1.5668 (78% of Fibonacci retracement levels) with a first target of 1.5748, it might resume to 1.5784.
• Below 1.5627 (61.8% of Fibonacci retracement levels), look for further downside with 1.5533 and 1.5475 targets.
[h=3]Technical Levels:[/h]R3: 1,6037
R2: 1,5881
R1: 1,5784
PP: 1,5628
S1: 1,5531
S2: 1,5375
S3: 1,5278
Chart Tools:
• It should be noted that the market was very stable and the trend was also very clear (upward).
• Range was: 253 pips (downward).
• The value of 50% Fibonacci retracement levels is: (High + Low) / 2 = 1.5598. (The key level to confirm a bullish market).
• Volatility is 394.62 so the market has called for a high volatile.
[h=3]Observation (s):[/h]
• Use historic prices to determine the future prices.
• Fibonacci retracement uses to determine accurate psychology level of support and resistance, and playing according to in this kind of period.
• Fibonacci is in a range trader (it is looks like the trend is trapping and going up or down, if you sell or buy for a long term in this period you'll go sure for losing your profit.
[h=3]Warning (s):[/h]
- Stop Loss should NEVER exceed your maximum exposure amounts.
- Usually the market has a high volatile, if the last day had a huge volatility.
The material has been provided by Instaforex Company - instaforex.com
