Let’s recap what we’ve learned about trading using the Fibonacci retracement levels.
First and foremost, the Fibonacci retracement tool is a predictive technical indicator that forex traders use to identify the potential support and resistance areas. The tool can be applied to any time frame and any type of forex chart.
The key Fibonacci retracement levels to keep an eye on are: 23.6%, 38.2%, 50.0%, 61.8%, and 76.4%.
Before you can apply Fibonacci levels to your charts, you need to identify Swing High and Swing Low points.
A Swing High is a candlestick with at least two lower highs on both the left and right of itself.
A Swing Low is a candlestick with at least two higher lows on both the left and right of itself.
Then, for downtrends, you’d on the Swing High and drag the cursor to the most recent Swing Low.
For uptrends, you’d click on the Swing Low and drag the cursor to the most recent Swing High.
And that’s it…. well in a nutshell anyway. If you skipped the previous lessons, then I would definitely recommend you read through them.
To help you memorise all of the above, we have prepared a cheat sheet with everything Fibonacci to help you along the way.
There ya go!
Feel free to download it by hitting the Download button below.