Complex trading system #5 (Fibonacci trading)

@ H.B: The Fibos should be the same at every trading platform, so I don't understand why you can't use them. These levels should appear as horizontal lines when you add the retracement to your chart.
So after you added the retracement to your chart you should see these lines. Now you check at which price they are, and above/below this level you set your Stop-Loss/Take Profit, according to the strategy.
Sorry if I misunderstood your question, but this is the answer to what I thought you mean.

Now I have another idea to filter bad trades:
Just look at higher timeframes and check in which direction the pair you want to trade moves and only open trades in the direction of the trend on the higher timeframe. You could also check on the next two higher timeframes available on your platform, (ie. if you trade 5 min you check trend on 15 min and 30 min (Metatrader)).

Regards

Philipp

I just want to add something I forgot in my last post:

If you enter a trade and there is a Pivot-Level (PP, R1, R2, R3, S1, S2, S3) a little (about depending on currency pair and timeframe (about 10 pips for EURUSD, 5min timeframe)) below (buy)/above (sell) the 0.618 retracement line set your SL not above (downtrend) / below (uptrend) the 0.618 Fibonacci retracement level, but 4-5 pips + spread above (downtrend) / below (uptrend) the Pivot-Level.
This is because price will move to Pivot and bounce back again (descibed here: http://forex-strategies-revealed.com/scalping/1minute-pivot-point-scalpi...). The same is with other major support and resistance levels. So if price is not able to break through this level it usually goes in the other direction again after some sideways movement and you will have a winning instead of a losing trade. If price breakes through this level you still have your SL, so you won't lose too much.

Regards

Philipp

Thank you, Phillip!
Great comments!

Edward

i am new trader with this system, but i knows how to use the fibo indicator, but am really having a little problem here, please can you just make this this simple method a bit clear to me, i.e when to enter a long and short position. with a meta4trader fibo indicator and chart.i really want to learn this this method because i have been lossing with my old method. mail me please ogbete_bibi@yahoo.com
thanks
tony from NG

Hi Tony,

it is normal to be struggling when you try to apply a system that someone else uses, especially when you're trying to concur Fibonacci method. There is hardly ever a quick start - just read the strategy and comments on this website over and over again until it becomes clear.

With all my respect, there is no point in repeating the strategy rules over again. If you have any specific questions: a certain sentence or point, at which you no longer able to follow the logic behind the system, then feel free to quote and ask for further interpretation.
Also, after all, don't stop on one strategy if you have difficulties with applying it, move on, this way you'll make even more progress.

Cheers,
Thomas

Edward & All

Thank you for this strategy. I have been using the fib retracements for few weeks now, but I have always struggled to know at which level should I enter the trade. Sometimes I would make an order entry at the 38% level, but the retracement would go to 50% or even 62%. And sometime I make order entries at the 50% or 62% level, and the market would hit the 38% and resume the trend. With the use of WMA 5 and other suggestions in this post I could now spot bad trades as well as entry points. I will test this a little bit further and let you know the results.

Regards

Younes
Japan

Hello Edward

Thanks for your effort i have 1 question
how can i get the WMA indicator plz ?

WMA is Weighted Moving Average. It should be available on every trading platform. Try asking your broker if you can't find it, otherwise you can more or less substitute it with SMA - simple moving average.

Regards,
Edward