Forex technical analysis-summary of Fibonacci usage.
The three most important Fibonacci levels: 38.2%, 50.0%, 61.8%
The key Fibonacci levels that we need to focus on are: 23.6%, 38.2%, 50.0%, 61.8% and 76.4%. The exchange rate at 38.2%, 50% and 61.8% level will get the most support or resistance under normal circumstances.
Traders use the Fibonacci retracement as a potential support or resistance. In view of the large number of traders paying attention to these price levels and setting buy or sell orders, or setting stop losses, Fibonacci resistance and support levels will become self-fulfilling fables.
The key Fibonacci extensions are: 38.2%, 50.0%, 61.8%, 100%, 138.2% and 161.8%.
Traders use Fibonacci extensions as potential support and resistance areas to seek profit targets. Given that many traders are paying attention to these price levels and setting buy and sell orders to make a profit, this tool also works because of the self-fulfilling fable.
In order to show the Fibonacci level on your graph, you first need to determine the swing high and swing low.
The candle line with the high point of the band is that on the left and right sides of the candle line, there must be at least two candle lines with a lower high point than the candle line.
The candle line with a band low is that there are at least two candle lines with higher lows than the candle line on the left and right sides of the candle line.
Since many traders are using Fibonacci tools, these levels will become self-fulfilling support and resistance levels, or profit areas.
When using the Fibonacci tool, if we use it in combination with other support resistance levels, trend lines, or candle patterns to select our entry points and stop loss points, our chances of successful trading will increase greatly.