Correct use of Fib retracements on AUDCAD

Hey guys,

I have a question about fib replacements. basically it is the proper use and where to apply them.

This is on the AUDCAD. The fib retracement should be placed at the .94128 area since that is the bottom of the move downwards. Bit should the top be placed at the .97133, area or should it be further back at the .98806, 1.00824, 1.03501 or 1.07161?

The different areas give different retracements. I’m trying to understand which high the fib level should be put on for proper retracements. Or perhaps are they all used by different people on different time frames?

Thanks!

Different people different time frames and different measuring points between different people on the same time frames. Way too subjective. Keep it simple and draw it on the most obvious areas. Why? Because if it’s obvious to you, it’s obvious to others. And if it’s obvious to a large group of traders, then it will mean something due to orders clustering there (although fibs never generate sufficient order flow on their own, but that’s above the scope of this thread).

So where would you put it on this pair in this situation?

Nscrilla, I am a big fan of the fib retracments in my trading. Actually there is no clear rules on where to put them.

you have to try several ones untill you find the one the the pair is following. When you find it it is obvious for the pair is respecting the level quite well.

There may be several retracements to take into account as they may vary according to the time frame you are looking at.

For AUDCAD I have two.

One on the monthly


And two on the weekly. Both of them tell you the same thing : the pair is up against a resistance.



And if you look at the daily you may find two or three possible retracements. So there is no absolute rule about which one you have to use. Just try until you find one that looks accurate enough.

YouTube give this a try.
Gp

Thank you both for these reply’s. I never used to use fib’s but now i am seeing that they are in invaluable tool. The more tools in the toolbox the better information we can make and can have a grater chance of making the right decision.

I suppose in the future i will use several fibs on the different time frames (month, day, 4 hour) to see which one the pair looks like it is following as my trades tend to last several days to weeks.

Thanks!