Fibonacci levels are one of the most reliable tools of technical analysis, which is used to discover the hidden levels of support / resistance and other important market abroad.They lie mostly in the basis of the strategies built on pullbacks prices.
To find these hidden levels sufficient knowledge of Fibonacci numbers, instruments, binding on the chart price highs and lows, and simple calculations.
Fibonacci numbers are a sequence constructed in a special way: since the sum of two units, each successive number is the sum of the last two terms of the sequence.Thus, we obtain the following series of numbers: 2, 3, 5, etc., have remarkable properties.In particular, we are talking about the relationship of "golden section", which is reflected not only in art, but became indispensable when trading in the foreign exchange market.
Fibonacci bind important relationships that can be used to predict the interaction between trend and counter-tendencies of price movement.
Fibonacci correction level at 0.38 (38%), 0.5 (50%) and 0.62 (62%) and calculate by taking the basis of the Fibonacci numbers.Price after his motion is adjusted according to the percentage that helps predict the Fibonacci levels, which can penetrate up to kontrtrend major trend.
Fibonacci numbers also help determine how far into the state off price in search of new extrema until the flat area completes the current trend in the market.It is through these points will be hidden levels of support / resistance: they either price will fluctuate or she will develop from them in the opposite direction.
Trading on the Fibonacci levels is greatly simplified through the use of modern tools used for technical analysis.There was a time when swing traders had to rely retracement levels using a calculator, and then manually enter them into the computer.Currently, most graphics software includes a set of tools that allow you to just a fraction of a second do all the required mathematical calculations.
In particular, the terminal MT Fibonacci retracement grid set with a simple tensioning tool "Fibonacci lines".Options for its construction vary depending on the goals.
Determination of the depth correction
Fibonacci to determine the end of the correction obtained tension grid, which completely covers the pulse movement from its beginning to the end of the wave.The strongest levels of support / resistance will be in this case, the following values of lines: 38.2 (38%) 50 (50%) and 61.8 (62%).They recorded a profit if the trade (despite the fact that it is very dangerous) is being carried out against the trend or the entrance to the market trend, for example, using a pending order.
Determination of potential targets
To determine where the price can strive, on the contrary the net is pulled from the end of the motion before it starts.Usually in this case the levels of 161.8 (162%), 261.8 (262%) and, possibly, even 423.6 (424%).This is especially true of currency pairs with high volatility, which are able to travel long distances.It is these values should be considered for profit in trading.
With the considered parameters define the important technical levels.Each trader decides how to use them.For example, it exposes them pending orders, for some it's the level of stop-loss, and still others are taking profits.
Fibonacci - a significant landmark for almost any trader, and therefore it is they accumulate significant amounts of trade.That is why even in the case where the Fibonacci sequence itself completely and not work out, the influence of the masses "forces" working levels.