Fibonacci Trading

Time frame: any over 5 min and less than 3-4 hour.

Currency pairs: any.

Indicators: 5 WMA

Look at the price waves. Find the most recent swing high and the most recent swing low = so called Fibonacci A swing and B swing.

Pull Fibonacci from A to B.

To know which direction to pull (up or down) simply look at the trend; if it is unclear, find appropriate AB swings and set Fibonacci in both directions.

Once set, wait and watch the retracement from AB swing to unfold.

During the retracement there are three conditions to be met in order to consider trading:

1. The price must touch 5 WMA.

2. The price must at least touch 0.382 Fibonacci retracement level.

3. The 0.618 Fibonacci retracement level must not fail. Here it means the price should not close below (uptrend) / above (downtrend) 0.618 retracement line. It can touch or poke it, but the level must withstand the “attack”.

When all three criteria are met, enter once the candle is clearly closed above 5 WMA for Long entry, below – for Short.
Stop order is placed always 4-5 pips above (downtrend) / below (uptrend) the 0.618 Fibonacci retracement level.
Profit target is set to 1.618 Fibonacci expansion level derived from point A.

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