How to Analyze 61.8 Fibonacci Extension Level

We useFibonacci Extension Areas to estimate where the market trend movement will reach. There are 2 important Fib Extension areas: 61.80% and 100% Fibonacci Extension Levels, these are used for taking profit.

61.8 Indices Trading Fib Extension Level

61.8 Indices Trading Fib Extension Level is the most commonly used indices profit-taking level when trading using the Fib Extension Technical Indicator.

To draw Fibonacci Extension levels on the stock indices chart we wait until the stock indices price retracement is complete and the stock indices price starts to move in original direction of the Indices trend. Where the stock indices price retracement reaches is used as chart point 3. Fibonacci Extension Indicator is plotted using 3 chart points as illustrated on the stock indices example explained below of how to plot the Fib Extension Technical Indicator Tool.

The Fib Extension example explained below shows the 3 Chart Points where the Fibonacci Extension technical indicator is plotted, marked as Chart point 1, Chart point 2 and Chart point 3.

Chart point 1 is where the indices trend started, Chart point 2 is where the indices trend pulled back and retraced & Chart point 3 is where the stock indices retracement reached as shown on the Fib Extension Technical Indicator Tool examples explained below.

The First Fibonacci Extension Level is the 61.8 Indices Trading Fibo Extension Level shown Below Used to Set Take Profit Indices Orders

Fibonacci Extension Level is the 61.8 Indices Trading Fibo Extension Level shown Below Used to Set Take Profit Indices Orders

Please note where these Fibo Extension areas are plotted - Fibonacci Extension zones are drawn above the Fibo indicator, these are the chart points where one will set takeprofit orders using these Fibonacci Extension Levels - 61.8% Fibo Extension Areas.