Tag Archives: fibonacci_extension

USDCAD Bat Pattern Butterfly Pattern Fibonacci Retracement Confluence Flat Candle Long Forex Trading Position

USDCAD Bat Pattern Butterfly Pattern Fibonacci Retracement Confluence Flat Candle Long Forex Trading Position

Snapshot:

USDCAD Bat Pattern Butterfly Pattern Fibonacci Retracement Confluence Flat Candle Long Forex Trading Position
USDCAD Bat Pattern Butterfly Pattern Fibonacci Retracement Confluence Flat Candle Long Forex Trading Position

Reasons For Trade:

  1. Fibonacci confluence of 78.6 of overall impulse leg, 61.8 of another impulse leg, 161.8 fib extension of recent retracement.
  2. Flat candle in zone suggesting new orders started from there which has fibonacci confluence with 88.6 Fibonacci retracement level and Fibonacci extension of recent retracement. This makes an area very string due to bat pattern formation.
  3. Level on Level demand area. So we will have to combine.
  4. This impulse leg has string ERC candles which broke previous structure.
  5. Due to 161.8 extension of recent retracement this zone also has completion of Butterfly Pattern too which coincides with flat candle and bat pattern completion on the same point.

Stop Placement:

Below flat candle

Targets:

First: 38.2 fibonacci retracement
Second: 61.8 fibonacci retracement

Trade Execution:

  1. Wait for confirmation in the zone.
  2. As there are 2 fibonacci confluence levels creating level on level demand zone take multiple positions using zoning technique.

Concerns:

None

Planned News/Events Expected:

Whole next week is packed with USD CAD  news

MonOct 26 10:00am USD New Home Sales 468K 546K 529K
TueOct 27 8:30am USD Core Durable Goods Orders m/m -0.4% 0.0% -0.2%
USD Durable Goods Orders m/m -1.2% -1.1% -2.3%
10:00am USD CB Consumer Confidence 97.6 102.5 102.6
11:20am CAD Gov Council Member Lane Speaks
WedOct 28 8:30am USD Goods Trade Balance -58.6B -64.9B -67.2B
10:30am USD Crude Oil Inventories 3.4M 3.7M 8.0M
2:00pm USD FOMC Statement
USD Federal Funds Rate <0.25% <0.25% <0.25%
ThuOct 29 8:30am CAD RMPI m/m 3.0% 1.2% -6.8%
USD Advance GDP q/q 1.5% 1.6% 3.9%
USD Unemployment Claims 260K 264K 259K
USD Advance GDP Price Index q/q 1.2% 1.5% 2.1%
9:10am USD FOMC Member Lockhart Speaks
10:00am USD Pending Home Sales m/m -2.3% 1.1% -1.4%
FriOct 30  8:30am CAD GDP m/m 0.1% 0.3%
USD Employment Cost Index q/q 0.6% 0.2%
USD Core PCE Price Index m/m 0.2% 0.1%
USD Personal Spending m/m 0.2% 0.4%
9:45am USD Chicago PMI 49.5 48.7
10:00am USD FOMC Member Williams Speaks
USD Revised UoM Consumer Sentiment 92.6 92.1

 

Post Execution Review:

Pending

View it on TradingView

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Disclaimer: This web site is just my financial trading log and is for educational purposes.
Please do your research, analysis and take your decisions. You must not rely on my actions or analysis.
Please see the Disclaimer page.
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How Fibonacci Confluences Work In Forex Trading?

There is no doubt that markets move harmonically. Each move in any direction is somehow harmonically associated to some other move in past. As traders we should be able to recognise these moves and make use of them for our profits.

Fibonacci confluence is an area/zone where more than two Fibonacci levels are in close proximity with each other. This zone has high probability of trend reversal and hence can be traded. Fibonacci confluence along with structure create powerful trading opportunities.

For example take an example as below. The zone marked in red had multiple Fibonacci confluences making is perfect zone for an trend reversal entry.

It had:

  1. 3 Drives Pattern completion
  2. ABCD Pattern completion
  3. 1.272 Fibonacci extension from last retracement
  4. 1.414 Fibonacci extension from previous retracement
  5. 50.0 Fibonacci level of impulse leg

It turned out to be a winner as the trend reversed from this zone achieving all targets:

#GBPUSD LONG IDEAS (200 SMA, ABCD PATTERN, STRUCTURE).-2png

Most common and major Fibonacci levels are:

  • 38.2
  • 61.8
  • 78.6
  • 1.272
  • 1.618

Other minor Fibonacci levels are:

  • 23.6
  • 50.0
  • 88.6
  • 1.113
  • 1.414

However it is important to note that not all Forex pairs use just major levels of Fibonacci. They have their own personalities. For example EUR pairs such as EURUSD uses these levels more often

  • 23.6
  • 50.0
  • 88.6

In the example below a confluence of 127.2 extension of last retracement with 88.6 of impulse was good enough to give us completion of two targets.

#EURSD 15 MIN LONG-2

USDCHF also makes use of these levels.

So it crucial to understand their personalities and use their usual Fibonacci levels to find the confluence zones.

Good Luck.

-TradeYodha

 

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Leave a comment: I would love to hear your thoughts, suggestions on this topic. Please leave a comment.
---------------------------------------------------------------------------------
Disclaimer: This web site is just my financial trading log and is for educational purposes.
Please do your research, analysis and take your decisions. You must not rely on my actions or analysis.
Please see the Disclaimer page.
---------------------------------------------------------------------------------

#USDCHF LONG IDEA (HARMONICS)


#USDCHF Long Idea (Harmonics) by TradeYodha on TradingView.com

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Leave a comment: I would love to hear your thoughts, suggestions on this topic. Please leave a comment.
---------------------------------------------------------------------------------
Disclaimer: This web site is just my financial trading log and is for educational purposes.
Please do your research, analysis and take your decisions. You must not rely on my actions or analysis.
Please see the Disclaimer page.
---------------------------------------------------------------------------------