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Fibonacci Retracement is used by traders in many different ways, but increasingly there are those who want to find the so-called "holy grail" in this tool, but their strategies are usually so complex that they often make unnecessary mistakes.
Therefore, we will present here today the trading strategy "Wait Fibo Retracement", which is very simple, but its success rate in the long term is above 60%.
Fibonacci Retracement
A popular trading tool that is based on the Fibonacci sequence (0,1,2,3,5,...) and also serves traders as an identifier of important price levels, on the basis of which traders usually place their pending orders in the end.
Wait Fibo Retracement Strategy
As the name implies, this strategy is based on waiting, in the first case (chart below), for price to pass the Fibonacci Retracement level of 50 and then break either the 61.8 level (see chart below) or 38.2. Once these relatively simple conditions are met, a trade position is eventually entered in the direction of the breakout.
The second type of strategy in the case of "Wait Fibo Retracement", is on the other hand, that traders wait until the price hits the 50 level. If this happens, they enter against the direction of the hit, as it is expected that from this level there is usually a higher probability that the market will bounce (see the chart below - 4 times the hit and 4 times the entry to sell).
Today's Wait Fibo Retracement strategy achieves best results in rather oscillating markets, where success rates in the range of 70-80% can be achieved with the above techniques.
