How to Use Fibonacci Retracement with Trend Lines
Results 1 to 4 of 4
 0 Attachment(s)    

Thread: How to Use Fibonacci Retracement with Trend Lines

  1. #1
    Join Date
    Aug 2014

    Default How to Use Fibonacci Retracement with Trend Lines

    Another good tool to combine with the Fibonacci retracement tool is trend line analysis. After all, Fibonacci retracement levels work best when the market is trending, so this makes a lot of sense!

    Remember that whenever a pair is in a downtrend or uptrend, traders use Fibonacci retracement levels as a way to get in on the trend. So why not look for levels where Fib levels line up right smack with the trend?

    Hereís a 1-hour chart of AUD/JPY. As you can see, price has been respecting a short term rising trend line over the past couple of days.

    You think to yourself, ďHmm, thatís a sweet uptrend right there. I wanna buy AUD/JPY, even if itís just for a short term trade. I think Iíll buy once the pair hits the trend line again.Ē

    Before you do that though, why donít you reach for your forex toolbox and get that Fibonacci retracement tool out? Letís see if we can get a more exact entry price.

    Here we plotted the Fibonacci retracement levels by using the Swing low at 82.61 and the Swing High at 83.84.

    Notice how the 50.0% and 61.8% Fib levels are intersected by the rising trend line.

    Could these levels serve as potential support levels? Thereís only one way to find out!

    Guess what? The 61.8% Fibonacci retracement level held, as price bounced there before heading back up. If you had set some orders at that level, you would have had a perfect entry!

    A couple of hours after touching the trend line, price zoomed up like Astro Boy on Red Bull, bursting through the Swing High.

    Arenít you glad youíve got this in your forex toolbox now?

    As you can see, it does pay to make use of the Fibonacci retracement tool, even if youíre planning to enter on a retest of the trend line. The combination of both a diagonal and a horizontal support or resistance level could mean that other traders are eying those levels as well.

    Take note though, as with other drawing tools, drawing trend lines can also get pretty subjective.

    You donít know exactly how other traders are drawing them, but you can count on one thing Ė that thereís a trend!

    If you see that a trend is developing, you should be looking for ways to go long to give you a better chance of a profitable trade. You can use the Fibonacci retracement tool to help you find potential entry points.

  2. #2


    fibonaci is great number. we use it to get SL and TP. we will get effective SL, TP because fibonacci will give us supportance and resistance. we combine it with trend line. we will have effective signal.

  3. #3
    Join Date
    Mar 2015


    I like this tool a lot and I'm leaning how to use it properly. There is a nice article about Fibonacci also

  4. #4
    Junior Member
    Join Date
    Mar 2014


    very good system sir its realy very helpful

Similar Threads

  1. [HELP ME!!!] Give me information about Trend Eater & Fibonacci Sapper v4.0!
    By traderforex88 in forum Commercial expert advisors
    Replies: 0
    Last Post: 04-08-2010, 14:23
  2. DAX Fibonacci Retracement
    By FiboTrader in forum Technical analysis
    Replies: 0
    Last Post: 09-12-2009, 12:11
  3. Automatic Trend Lines for MetaTrader 4
    By TrendLineTrader in forum Indicators
    Replies: 0
    Last Post: 09-11-2009, 10:18
  4. Fibonacci Retracement at Gold
    By FiboTrader in forum Technical analysis
    Replies: 0
    Last Post: 09-10-2009, 10:49

Tags for this Thread

analysis, fibonacci, forex, high, hours, how to, low, profitable, resistance, short term, support, tool, trend

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts

How to Use Fibonacci Retracement with Trend Lines