Fibonacci trading strategy - upward and downward trend.pdf

The Fibonacci trading strategy both upward and downward trend Illustrated Theoretically and at PLUS500 online trading platform With Download link to free Fibonacci calculators By M Schneider

Year 2012

Hi, Thanks for signing up. In this letter I will use the online trading platform at PLUS500. If you haven’t signed up at PLUS500 online trading platform though my page Bonus2012.yolasite.com visit my page and get the sign-up bonus (£ 20 / € 25) and first deposit bonus (up to 30 % on first deposit). This letter will show the Fibonacci trading strategy in theory and at PLUS500 online trading platform. The content is 1. Fibonacci calculation 2. The Fibonacci trading strategy 2.1. Illustration – Uptrend 2.2. Illustration – Downtrend 3. Fibonacci trading strategy – using PLUS500 online trading platform 4. Fibonacci trading strategy - Free calculator 4.1. Free spreadsheet – a free Fibonacci calculator

PS. haven’t signed up at PLUS500 online trading platform though my page Bonus2012.yolasite.com visit my page and get the

sign-up bonus and first deposit bonus (up to 30 % on first deposit).

1. Fibonacci calculation In the first letter I described how the curves move from point 1, 2 and 3 and when to sell and buy. I also described the MACD/OsMA function.

2. The Fibonacci trading strategy The Fibonacci level is a rule that says if a curve goes from 0 to 100 % and falls to point 61,8% the curve will rise again to 100 % and fall to point 61,8 %. The rise from point C to D is usually the longest rise. If the rise from A to B is 100 % then the rise from C to D is 110 %. The rise from E to F is 100 %. The Fibonacci level is a rule and it’s not 100 % sure. A pull back strategy is necessary if the trend isn’t there. A strategy could be that the buy level is set to the 38,2 % level (31,18) - E – F - and the sell level is set to the 61,8 % (36,18) level – E - F. The levels are illustrated in the graph in section

2.1. Using this strategy the profit and risk is smaller than the 100 % Fibonacci trading strategy where the buy level is E (28,82) and sell level is F (40). The 61,8 % level (31,18) – C – D - and the 38,2 % level (31,18) - D – E - is similar. The difference from the 61,8 % level (31,18) to the top 100 % (35) at point D is 38,2 %. From point D to the 38,2 % level is of cause 38,2 %. The 38,2 % is a level that indicates that the curve will change soon if the curve follow the rules 100 %. At point D is an expectation that the curve will start to fall and at point E is an expectation that the curve will start to rise. At the 38,2 % level is the first indication that the curve will start to fall (D) and rise (E). The levels are illustrated in the graph in section 2.1. 2.1. Illustration - Uptrend The illustration below shows that a rate goes from 20 to 30 – point A to B. The 100% level is

the difference between 20 and 30. 100 % is in this example 10. The curve falls to point C - the 61,8 %. In this example 23,82. The calculation is the 100 % rise from A to B – 10. 61,8 % of 10 is 6,18. 6,18 minus point B – 30 – is 23,82 - point C. The 38,2 % and 50 % line is calculated as the 61,8 % point - just replace the % levels in the equation.

If there is a trend the curve will rise from point C to D. The difference is the pull-back level plus 100 % - in this example 25 plus 10. Point D is 35. The curve will start to fall to point E. The calculation is 10 – the 100 % from point C to D – minus 38,2 % - the 38,2 % level . The 50 % level is 10 – the 100 % from point C to D – minus 50 % and the 61,2 % level is 10 – the 100 % from point C to D – minus 61,8 %. The calculations are in the boxes in the illustration above. 2.2. Illustration - Downtrend Below is illustrated how a downtrend looks like and is calculated. The calculations are similar to the calculations at the uptrend. In the boxes beside the graph are the downtrend calculations explained.

3. Fibonacci trading strategy – using Plus500 online trading platform I selected wheat at the trading platform Plus500 to illustrate a downtrend. The high level is 775 and the low level is 600. Using the calculation above the figures is as illustrated. From the trading strategy 123 trading signals there is a buy signal starting in July. The curve moves in the right direction and the signal is correct in end of September. Using the Fibonacci trading strategy the rate will fall 100 % - if there is a trend. The lowest rate to buy at is 600. The 38,2 % level is at 667. The buy level is between 600 and 667.

The highest level to sell at is 708. To be sure to call a profit there is a pull-back level at the rate 688. The 708 level is our anticipation – it’s not sure that the rate will be 708 or higher / lower – and it’s the reason why there is a pull-back level.

The curve falls from 708 to 513. A new buy option is available. The lowest rate to buy at is 513. The 38,2 % level is at 580. The buy level is between 513 and 580. The highest level to sell at is 620. To be sure to call a profit there is a pull-back level at the rate 601. The figures in the illustration are rounded. 4. Fibonacci trading strategy - Free calculator The calculations are manually illustrated above - theoretical and at the online trading platform PLUS500. At http://www.alphascanner.com/Resources/Fibonacci there is a free calculator and the calculator is explained in this video at http://www.youtube.com/watch?v=UWAxhhPD2pY. At http://www.forexfibonaccicalculator.com/ there is another free online Fibonacci calculator.

4.1 Free spreadsheet – a free Fibonacci calculator I used a spreadsheet calculating the Fibonacci levels in the examples. I made the spreadsheet as I wrote this letter and inserted the images of the upward and downward trends beside the calculations. How does the spreadsheet work? Enter level A and B. The spreadsheet calculate the buy

rate and sell rates at different levels. At the next page is an image of the spreadsheet. There is a calculation for both an upward and a downward trend. The rates are calculated at different buy and sell levels.



The spreadsheet is free and the download link is – Free spreadsheet – a free Fibonacci calculator

