Again I have tested it as add-on to additional indicators too, there is no edge in so called support/resistance to any 'random' retracements. Because any retracement, any Fibo, is random. I have it backtested for forward tested. There is no edge I could find here. If you are only manual trader how do you avoid your bias which can easily lead to hindsights ?
Fib Arcs (MNQ overnight in this instance). As I have said before only those who don't know how to use them properly will find them random and ineffectual. Not as simple as click fib toolbar icon and two spots on a chart:-
The lines are bit thick, but I see many whipsaws around those lines too. You can get stopped out several times at least. Also when not reached and then it reverses totally, hmm... that makes it difficult to trade. Then goes above with correction or not and bounce several times along the line. How would you trade this ? Any systematic rules, no hindsight here ? It also depends very much on your scale, so you have it curve fitted here with hindsight bias. And then you want to tell me you could or did make how many points with this ? Any longer term statistics from your trades with this ?
I trade retracements, so i am a counter trend trader, i wait for a set up,if the set up suits my strategy i then enter the market.
You say that you have back tested fib retracements ,can i ask what time frames you used also what fib levels.
Andy you say you have done backtests and a little walking-forward and could not find an edge maybe Fibonacci levels is not for you.?
Did you back test using them as an indicator to buy/sell random retracements/extensions, or use them more as a measurement aid within your trading plan? For example, did price get rejected at a fib level on a retracement where countertrend traders were likely to take profit? Trade it. Did price blow through the fib level on a retracement without stopping? Maybe wait if you're looking for a re-entry with original trend and there's no other good reason. Looking for a second leg, put the extension on to measure it out and watch how price reacts. With that said I mostly just use them for 50% retracements and measured moves.
50% retracement definitely works from what I've observed. Not so much because it has any merit on its own, but so many traders follow it like a mantra. I can't say the same for other Fib levels though.