Fibo Extension Indicator Example

To Calculate Fibo Extension zones on indices charts we use the Fibo Extension Indicator

What are the Fibo Extension Levels?

• 61.8% Fibo Extension Level
• 100% Fibo Extension Level

We use Fibo expansion areas to estimate where the stock indices price movement will reach. There are two important fibonacci expansion areas: 61.8% and 100% Fibo Extension zones, these level are used for taking profit.

To draw Fibo expansion we use Three chart points.

To draw Fibonacci extension levels we wait until the stock indices price retracement is complete & indices 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 Fibo extension indicator is plotted, 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 price retracement reached as pictured on the stock indices example illustrated below.

Fibo Extension Indicator Explained

The two Fibo extension levels 61.8% and 100% Fibo Extension zones were then drawn above the Fibo Extension Indicator as shown on the stock indices trading example above.