The levels above Fibonacci are the support and resistance levels that are worth paying attention to. With the idea that after forming an uptrend or decrease, prices often return to correcting. At this point, the levels above Fibonacci plays a role in showing the degree of price correction.

Therefore, the levels above Fibonacci that act as support and resistance during price corrections are very good. The greater the time frame, the stronger the reliability of these levels.

As for the fibo drawing, you should draw the trend. During an uptrend, we draw the bullish fibo from bottom to top on the uptrend wave. And in contrast to the downtrend. In a chart, we can draw many fibos with different highs and bumps. However, the larger the timeframe the stronger the levels on the fibo.

There are many types of fibos, but we will only focus on regressive fibos.

Fibonacci examples:

The first chart is a bullish fibo image in an uptrend on the D1 chart:

And this chart is fibo in a downtrend on D1:

And there is a very important point to note that when drawing fibo, remember to note that the price cannot exceed 0 or 100 on the fibo. 2 This level should be at the bottom and top of that wave.

Traders can rely on fibo to see how much price correction will be. There are times when the price reaches 23.6 and then returns to the uptrend, sometimes higher and then continues the trend. Many times the price reaches 61.8 and continues to surpass this level, many traders believe that the trend has been broken or about to be broken. While other traders have a higher requirement on breaking 100 to be considered a broken trend.

Some important notes when using Fibonacci:

Transacting with Fibo, you should pay attention to the following points:
  • The best way to draw and use Fibonacci in trading is on a chart H4 and up. In the H4 frame, it can be said that Fibo gave reliable signals, and the support and resistance levels are also strong so that traders can focus on trading there.
  • Use fibo to look at the correction and the levels at which the correction can come to focus on trading opportunities.
  • Starting at 38.2, traders can focus on trading. Even stronger levels are 50 and 61.6. 76.4 is used more often on pairs with stronger and more volatile price movements such as crosses.
  • If the price adheres to 23.6 in the first place, there is a possibility that level 38.2 will fail on the first or second test. it is likely that prices will level off for a while. Because these are the first stages of a correction, at this point buyers and sellers have yet to decide whether a true deep correction will happen or if it is just a minor correction. If the price moves deeper, the two levels it can find are 61.8 or 76.4. It is very important to know how the price reaches 23.6