Probably just as important as knowing where to enter or take off profits is knowing where to place your stop loss. You can’t just enter a trade based on Fib levels without having a clue where to exit. Your account will just go up in flames and you will forever blame Fibonacci, cursing his name in…
The next use of Fibonacci will be using them to find “take profit” targets. Gotta always keep in mind “Zombieland Rules of Survival #22”: When in doubt, know your way out! Let’s start with an example of an uptrend. In an uptrend, the general idea is to take profits on a long trade at…
If you’ve been paying attention in class, you’d know by now that you can combine the Fibonacci retracement tool with support and resistance levels, and trend lines to create a simple but super awesome trading strategy. But we ain’t done yet! In this lesson, we’re going to teach you how to combine the Fibonacci retracement tool with your…
Another good tool to combine with the Fibonacci retracement tool is trend line analysis. After all, Fibonacci retracement levels work best when the market is trending, so this makes a lot of sense! Remember that whenever a pair is in a downtrend or uptrend, traders use Fibonacci retracement levels as a way to get in on…
Like we said in the previous lesson, using Fibonacci levels can be very subjective. However, there are ways that you can help tilt the odds in your favor. While the Fibonacci retracement tool is extremely useful, it shouldn’t be used all by its lonesome self. It’s kinda like comparing it to NBA legend Kobe Bryant. Kobe was…
Back in Grade 1, we said that support and resistance levels eventually break. Well, seeing as how Fibonacci levels are used to find support and resistance levels, this also applies to Fibonacci! Fibonacci retracements do NOT always work! They are not foolproof. Let’s go through an example when the Fibonacci retracement tool fails. Below is a…
Let’s talk about Fibonacci retracement levels. Fibonacci retracement levels are horizontal lines that indicate the possible support and resistance levels where price could potentially reverse direction. The first thing you should know about the Fibonacci tool is that it works best when the market is trending. The idea is to go long (or buy) on a retracement at…
We will be using Fibonacci ratios a lot in our trading so you better learn it and love it like your mother’s home cooking. Fibonacci is a huge subject and there are many different Fibonacci studies with weird-sounding names but we’re going to stick to two: retracement and extension. Let us first start by introducing you to the Fib…
We’ve covered a lot about Japanese candlesticks. Hopefully, you’re not at wick’s end but are actually now fired up about candlestick charts. Maybe we’ve even ignited a flame that becomes a lifelong passion for Japanese candlesticks. Let’s summarize what you’ve learned about Japanese candlesticks: If the close is above the open, then a hollow candlestick (usually displayed as white) is…
Here are some common mistakes that new traders often make when using Japanese candlesticks. 1. You try to find meaning in EVERY candlestick that appears on the chart. A lot of the time, markets are “noisy.” Not every candlestick useful when thinking about future price movements. Instead of looking at every candlestick, focus on the ones where…