Fibonacci Retracement Trading

Discussion in 'Technical Analysis' started by options4me, Oct 1, 2008.

  1. I have been a real supporter of using the Fibonacci Retracement and Extentions for trading targets on daytrading.
    Just thought I would post my observations for the past two days.

    If you plot the first major S/R in the opening hour, this is what you get...
    Normally use the -132.8 and the -161.8 as a reversal point to enter a trade. (yesterday was an exception)


  2. Here is what happen after it hit the -161.8% level....

  3. Lets see where it goes to today.
    Looking for a reversal (buying opportunity ) between the -132 / -161 Retracement range.

  4. Looks interesting....based on your handle, do you make options trades in the 138-161 zone?
  5. I was looking at another play that has a great range in daytime movement, and it seem to follow the same Fibo patterns.


    Will check back later to see how the Oct 50 put does now that it has started a retraced near the -161.8 range.
  6. I have made a few on the reversals when it hits that range, but I also will place a trade in the trend direction after the opening S/R has been established. Use these Fib levels as a targets to exit also.
  7. mxjones


    I am a supporter of Fibs too. Check out Trader-X's blog - there are several years worth of charts there. His analysis does not seem as detailed as yours, but it has helped me. And you can't beat the price - free.
  8. Here is another example of the Opening hour High / Low, setting the pace for a nice Fibonacci play.

  9. I am a huge fan of fib retracements and extensions for targets and pivot points. I've done some trading videos explaining how I use them. Feel free to check them out here...

    Chris Dunn
  10. fib levels are not more significant than any other level. Studies such as the following (attached):

    "Our conclusion must be that there is no significant difference between the frequencies with which price and time ratios occur in cycles in the Dow Jones Industrial Average, and frequencies which we would expect to occur at random in such a time series. In our introduction, we noted that empirical evidence from academic studies suggests that not all of technical analysis can be dismissed prima facie. The evidence from this paper suggests that the idea that round fractions and Fibonacci ratios occur in the Dow can be dismissed."
    #10     Oct 13, 2008