Fibonacci Expansion Indicator Tutorial
To Calculate Fib Expansion levels on indices charts we use the Fibonacci Expansion Indicator
What are the Fibo Expansion Levels?
- 61.8% Fibonacci Expansion Level
- 100% Fib Expansion Level
We use Fibonacci expansion levels to estimate where the stock indices trading price movement will reach. There are 2 important fibonacci expansion areas: 61.8% and 100% Fibonacci Expansion levels, these level are used for taking profit.
To draw Fibonacci expansion we use Three chart points.
To draw Fibonacci expansion levels we wait until the stock indices trading price retracement is complete & indices trading price starts to move in original direction of the Indices trend. Where the retracement reaches is used as point 3.
The example explained and illustrated below shows the 3 Chart Points where the Fibonacci expansion indicator is drawn, marked as chart point 1, 2 and 3. Chart point 1 is where the stock indices price trend started, Chart point 2 is where the stock indices price trend retraced and chart point 3 is where the stock indices trading price retracement reached as displayed on the stock indices trading examples explained below.
Fibonacci Expansion Indicator Explained
The two Fibo expansion levels 61.8% & 100% Fibonacci Expansion levels were then drawn above the Fibonacci Expansion Indicator as shown on the stock indices trading example above.
