Are Fibonacci levels overrated?
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Thread: Are Fibonacci levels overrated?

  1. #1
    I was first introduced to Fibonacci amounts when I read a trading platform by Quantum Global. Basically, if there is a wave greater than 40 pips at height, then you're supposed to play with the Fib levels, and filter out your trades based on RSI.

    That I backtested the method for a couple of years, and found it won 50 percent of their time.

    I could flip a coin and have exactly the same results... 50/50.

    I realize many traders swear by Fibs.... And yes you can find Fib patterns in charts a lot. But how valid are Fibs really? My difficulty is that I think too many traders are playing Fibs in different timeframes... consequently a lot of sound in the charts.

    Oh and I firmly think the banks are not trading to make profits.... They're buying Forex prospective contracts to hedge their nation's savings based on fundamentals.... They're exercising the contracts and not selling them for profit. That's why price action is my bread and butter for the time being.

  2. #2
    1. You need to stop searching to get a 100 percent egy. I am extremely close to using extremely low reduction system with my closing update to my system, but guess what, that means I will need to leave a few more pips on the desk due to the way the new exit method functions. It will be just after I've exchanged the new exit method for at least a year can I find out when overall I will make more than that I did when I let my stop loss get hit and depart at higher R:R ratio. In my first few trades I've have no reduction but just a few transactions that reached their entire potential, whereas others were exited at 2-3 pips due to the new exit method. The amount of pressure relief I get knowing that I will become extremely low number of red trades is amazing, but again, I cannot predict that from today on I will never hit my stop loss. This is simply not true for one motive. If any crazy news comes out then even my exceptionally strict system won't have the ability to stop the price from hitting on my SL. So, I'll be spending the next 11 months attempting to find out if my new system functions or not. It's the underlying principle of retracement that's set in stone because of my trading style and not the particular mechanical principles.

    2. These amounts should just give you an idea just how much price correction has taken place. Beyond this, you need a strong entry system to take advantage of these retracements. This powerful system ought to lag more than price.

    3. Eventually, they need to concentrate on particular levels that allow you to enter early but the strong entry system makes sure you aren't entering way too premature. The lagging entry should delay your entry but the amounts focused on should give you sufficient retracement to let both the strong entry system and levels operate in harmony.

  3. #3
    1 Attachment(s)
    Quote Originally Posted by ;
    Are Fibonacci levels overrated?
    No, they aren't.

    I recommend Constance Brown's novel:

    If you use Fibonacci Analysis on your trading and you have not dogeared this book into departure, it is my humble view that you aren't treating yourself to one of the very fantastic ways to optimize your decision making process. When you read and understand this novel, take some opportunity to return to the origins of H.M Gartley, then people such as Larry Pesavento, start to make more sense.

    Constance, provides what I think are some of those'missing links' in the normal understanding of the way and most importantly to presume that the market is harmonic and in what time frame.

    Successful Trading and see you next year! (this is the only place I make in this Specific thread)

  4. #4
    I haven't seen succesful traders using fibonacci levels.But I have seen succesful traders using fixed point theorem:

  5. #5
    Yes. Why would 61.8 mean anything?
    This is very straightforward.
    Fibbonacci projections happen to COINCIDE with instos GETTING DISCOUNT and GETTING PAID

    if a bank collects a huge place they would like to GET PAID significance a complete roration of price. And vic versa they want TO ACCUMULATE on a reduction.
    The reason fibs dont work all the time? Since its not the reason the markets moves. Lol. They coincide and sometimes they dont.

  6. #6
    Quote Originally Posted by ;
    Since Jan 1 2006 up till last week the gbpusd has retraced to the under mentioned fib levels (with in 7 pips) towards the conclusion of each day or until the close of the following day. Normally well over 50% these retracements begin around 9:30 am eastern standard time. 97.2% of the time it retraces into the 23.6 fib amount 86.9% of the time it retraces into the 38.2 fib degree 76.9% of the time it retraces into the 50.0 fib degree 63.8% of the time it retraces into the 68.2 fib degree. Using the fib retracements with this pair can be very beneficial in determining exit...
    I realize this is an antique comment, but it is perplexing. If the total of all data points is 100%, how do these levels be struck with these proportions? The amount is well over 100%. Does this mean price keeps progressing through level after level? I suppose so. The answer would be, as it always was. . .you don't have any idea which line is which. There's a 63.8% possibility that all four lines will probably be struck, lol, so which one is the right one? Who'd want to trade guesses?

  7. #7
    Quote Originally Posted by ;
    quote No, they are not. I suggest Constance Brown's publication
    Sorry for the loss. Been there, done that. Best of Luck.

  8. #8
    Yes they work but depends on how you use and view them. There's no holy grail method
    to use Fibonnaci sequences. Sometimes they work sometimes they do not. Why? Because markets
    move feeding on feelings and liquidity and the statistics change every single second.
    I use it like a confluence region and follow my setup, the profits or losses depends on the market.

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