ZeroG
2022-04-02

We all had went through a rough Q1 of 2022, where some major incidents like war, high inflation rate & potential hike of interest rate to lower inflation which caused many hot money to flow out from stock markets, and technology stocks with high PE are the first to feel the impact. At first I was scared, panic, & upset as my profit had to returned to the market but then I decided to learn something new to further enhance my skills.

That’s where I came across this indicator called Fibonacci retracement which I found it very useful and high accuracy. Here what I’m going to share is HOW TO DRAW AND APPLY FIBONACCI RETRACMENT IN STOCK MARKET.

What I do is for short term trading, I will use a 1 YEAR period for a particular counter, let say NVIDIA here. So here are the steps I used:

1: Click on 1Y to show the latest 1Y chart.

2: Find the lowest point (including the wick).

3. Find the highest point (including the wick).

4. Draw the Fibonacci Retracement line connecting lowest and highest point.

Fibonacci Retracement is made up of several levels which indicate SUPPORT and RESISTANCE. Arrow a, the correction reach the 0.618 line as support level and it rebound. When the price reached 0.382 (arrow b), it goes down again & reaching arrow C at 0.618, later it rebounded to arrow d before correction again.

REMEMBER THIS: A Resistance will become a Support after break up, and Support will become Resistance after break down. They are interchangeable so please be very FLEXIBLE.

Below are 4 general ways of using Fibonacci Retracement:

1. When the price near to support, we buy.

2. When the price near to resistance, we sell.

3. When the price break up resistance, we buy.

4. When the price break down support, we sell.

This is just a very general concepts of using Fibonacci Retracement, there are many factors affecting the price and may need some other indicators as reference too.

I hope this trade idea would be useful for you guys and for myself personally, I love this indicator & will keep apply this for my future trading.

Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.

Comments

  • MaudNelly
    2022-04-02
    MaudNelly
    Looks cool, it's the first time i know details about about FIBONACCI RETRACMENT.
    • ZeroGReplyMaudNelly: 
      Yea hope it may work out on u too[握手]
    • MaudNellyReplyZeroG: 
      I will try it,hope it can be a good references for me as well .lol
    • ZeroG: 
      Yea same for me, surprisingly the SR are quite in place, although not 100% accuracy but it may act as a reliable references for me [爱你]
  • FrankRebecca
    2022-04-02
    FrankRebecca
    Hey , please share more details /example on this if it's suitable for you,THX~
  • PenelopeHood
    2022-04-02
    PenelopeHood
    Thanks for sharing ,it seems a useful indicator to invest in the future.
    • PenelopeHoodReplyZeroG: 
      yeah!thanks for your idea. And have a nice weekend~
    • ZeroGReplyPenelopeHood: 
      Same to u[比心][比心]
    • ZeroG: 
      Perhaps u can try it out in diff charts and see hw it goes.. [爱你]
  • SiFu
    2022-04-06
    SiFu
    Interesting retractable method will study more. Thanks.
  • BoonL
    2022-04-08
    BoonL
    good
  • RTee
    2022-04-07
    RTee
    O
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