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In forex trading, there is perhaps no indicator that can be traded in as many ways as the Fibonacci retracement.
Although there are so many ways to trade Fibonacci levels, there is probably no doubt that one of the most used ones is trading the 0-100 levels, which are a reflection of what we already know in the market. However, today's strategy is different, it is based on using fibo levels that indicate what is not yet in the market and that is why it is also so unique.
Strategy entry rules
Entering long positions
-breaking the fibonacci level of 100 from the bottom up
Entering short positions
-breaking the fibonacci level of 100 from top to bottom
How to trade the future with Fibonacci - step by step
First of all, you need to create Fibonacci levels correctly (they are created using the tool found in the trend analysis menu - see the preview of the tool menu on the chart above). For better clarity, all levels between 0 and 100 have been removed in today's charts. The creation of the levels is always done from the future to the past, so in the chart below, it was drawn from point 2 to point 1. You have to imagine that when the fibo levels were drawn, almost nothing existed after point number 2.
Today's strategy then involves waiting for price to get to the 100 level again and break through it (see chart below point 3 - a breakout is only when the candle passes through the level and closes above it in the case of long entries, or closes below it in the case of shorts). As soon as the breakout occurs then a trade position is entered, in which the Stop-Loss is placed at about the midpoint, between the 0 and 100 levels (see chart below) and the Take-Profit is then placed at the Fibo level of 161.8. With this layout, proper money-management is ultimately always ensured, as the potential profit from a given trade then exceeds its potential loss every time.
With this strategy, it is possible to achieve a long-term success rate in excess of 55%, which is really more than enough in terms of money-management for today's strategy.
