Who has set itself in the head, to learn forex trading , will soon discover that there is a lot that goes along with successful forex trading. There are numerous commercial approaches and a number of indicators that can be used to analyze the markets and to implement a customized Forex Fibonacci trading strategy. Among the best known methods in Forex strategy action trading remains one of Fibonacci. Here are the market analysis based on certain numbers that have been known since the 12th century. Below we present the front Fibonacci Trading.
The most important thing around the Fibonacci Trading:
- The principle of the Fibonacci trading is based on the assumption that the price movements specific patterns are
- The Fibonacci Retracements are based on a specific set of numbers, which is known since the 12th century
- Fibonacci Retracements are standard equipment of every good Forex Charting Software
1) Introducing the principle of the Fibonacci trading
Let’s look at the principle on which the Fibonacci trading is based. Markets do not move chaotically in the one direction or another, but let in trends and corrections recognize proportion patterns that serve traders as a resistance or support. Fibonacci Retracements are easy to understand and provide concrete information about the market. Fibonacci Retracements are based on the Fibonacci sequence of numbers, the so extends the standard «1.1, 2, 3, 5, 8, 13, 21, 34, 55, 89». Any number of the series corresponds to the sum of the two numbers preceding it. This can be easily transferred to the oversimplified Visual: The extent of market movement also depends on the extent of the previous movement.The Forex Fibonacci Trading System is based on the idea that not move the prices of traded markets chaotically in all directions but follow certain patterns. Thus, it is assumed that the extent of a particular market movement also depends on the previous movement market.
Conclusion: The Fibonacci Retracements are based on a series of numbers, in which a number always represents the sum of the two previous numbers.
2.) To record and interpret Fibonacci Retracements
From the number range, the so called Fibonacci levels be mathematically derived. Between levels «0» and «1» (1 corresponds to 100 percent) are, in particular the levels 38.2 percent, 50.0 percent and 62.8 percent relevant. The percentage shown expresses the share of market movement, the correction has relativized. What is that about has clearly when drawing the levels in the chart. Almost any Forex charting software is one of a Forex Fibonacci retracement for that functionality. The statement is identical in all markets. If the EUR / USD rose to a definable movement of 1.30 to 1.35, the 100-percent retracement is at 1.30 (ie the beginning of the movement) recognized. The 0-percent retracement is hand placed at 1.35. The other levels are triggered automatically and are drawn by the chart program. The further corrects the market towards 1.30, the greater the proportion of the previous movement, which is corrected.
Conclusion: When applying the Fibonacci trading so-called Fibonacci levels are derived from the defined number sequence. The percentage of the level expresses the proportion of a price move that has been put into perspective by a correction again. Almost every forex platform includes the Fibonacci Retacements.
3.) Forex Fibonacci Trading: How it works
Fibonacci Retracements are no tea leaves: Too often are the three main levels of correction movements for Meaning: The correction may end, it will weaken or accelerate. These contradictory at first glance features make the interpretation of Fibonacci Retracements simple: The levels are handled as support or resistance. If the market moves from the top of a retracement towards, this acts as support and vice versa. Forex Fibonacci Trading is understood for years as an independent discipline. However, traders must not be confined to the retracements, but should rather use in the context of other technical evidence. Does z. B. the 38.2 percent retracement of a major horizontal support together, which is a very strong combined signal. To a «magic bullet» to market forecast — how many book titles and many Forex implies Fibonacci tutorial — not it is the retracements but: The «hit rate» is not significantly higher than in other instruments of the chart and market technology.
Conclusion: If corrective movements are in many cases three possible scenarios of importance. An existing trend may be faltering, speed or it may also end. These considerations also allow easy interpretation of retracements. The Fibonacci levels act as support or as resistors.
4.) You can learn the Fibonacci Trading
Although the basic principles and the principle of Forex Fibonacci Trading Systems are not difficult to understand, no one is just by reading the trading professional. Experience is critical to successful trade, the A and O. But how can the inexperienced investors get into forex trading without risking his capital here? A forex demo accountcan be a valuable tool when it comes to gain their first trading experience and to familiarize with indicators such as Fibonacci retracements. Almost every forex broker offers at the present time such a demo account that is free and in the most cases is also unlimited time. Most also realistic trading conditions on offer including free real-time quotes and full of trading platform.Who is looking for a new forex broker, the provider should then choose which training program provides this. For many brokers include free seminars, webinars, specialist publications and training videos for range and such offers can be very valuable when it comes to master its entry into the Trading with flying colors.
Conclusion: If you want to try out the Fibonaci retracements in practice, a demo account, for example, open up with a broker and apply these indicators risk free under realistic conditions. It is also worthwhile to pay attention to the educational offer of a broker, because often there is the like a versatile selection of webinars teach the basics and deal with further leading knowledge.