23m 55s: Lenght

Forex and Fibonacci indicators In forex trading, Fibonacci retracements can identify potential support and resistance levels. The most important number or ratio is the 61.8% or .618 levels. There is also a 1.618 extension along with 2.618. From a trading perspective, the most commonly used Fibonacci levels are the 38.2%, 50%, 61.8% and sometimes 23.6% and 76.4%. In a strong trend (which we always want to be trading), a minimum retracement is around 38.2%. In a weaker trend, the retracements can be 61.8% or even 76.4%. A complete retracement or break of 100% of the prior move would nullify the current move. The Fibonacci Retracement trend line The base of the trend line should be drawn from left to right. If there is a bullish trend and you're noticing a retracement to the downside, then you want to look for support at one of the levels appearing on the chart. If there is a bearish (down) trend and a retracement is taking shape then you'd want to look for resistance. With any trading methodology it's impossible to guess future price moves with perfect accuracy. The next best thing is to watch levels of support and resistance closely. Once you notice a strong move off of support in an uptrend or resistance in a downtrend, you can use further levels of resistance as price targets. Fibonacci expansions and extensions can be effective leading indicators of price targets once a retracement level is honored. Deciding which tool to use is a personal choice for price targets -- both methods have their benefits. Because this tool is taking you into new price territory, trailing stops are recommended along with the proper trade size for effective risk management.