trouble with support/resistance and targets
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  1. #1
    Join Date
    Dec 2006
    Location
    Charlotte, NC
    Posts
    142

    Default trouble with support/resistance and targets

    Hello all.

    I have yet to introduce myself to these boards but I have been behind the scenes lurking and learning from just about everybody on this forum.I sometimes read peoples ideas and try to get a better understanding by finding other sources to learn just what they did. But now I am confused and have resorted to asking on this board.

    When most of you analyze your charts and set your (support/resistance), do you use Fibo. retracements and if yes what time frame do you usually observe this in or initially set it too? I have been trying to set it on daily charts (Metatrader 4) and then going back to H1 to read where it might go. Maybe my understanding on how to read this isnt as up to par as it should and I have read in baby pips school several times about Fibo but that is why I am here asking because I am still confused.

    Also as for targets how are you guys setting these and making your scenarios with your possible targets? I know Fibo Extensions was mentioned in the school about profit targets, but my sofware (MT4) only has Fibo Expansions. Is this the same indicator? Also when messing around with this I would set this by the rules of setting it up and the levels would be so far away it would not even be on my screen so I would not be able to even see where these levels occur at? Any help would be greatly appreciated and many reps to everyone who is helpful. Thanks in advance!

    ahefner33
    Last edited by ahefner33; 01-05-2007 at 01:46 AM.

  2. #2
    Join Date
    Dec 2006
    Location
    Wichita Falls, TX
    Posts
    2,805
    I'm personally not a user of Fibs in a conscious fashion. I will sometimes get an idea of a 50% retracement to pick a target from a break, but that's not my first option. I favor straight up chart support and resistance when I do my analysis. Where the market has actually traded, and therefore the prices which traders have actually indicated are significant, means more to me than some calculated figure.

    That's not to say Fibs cannot be very handy. I've certainly known quite a few traders who have used them, especially in forex. They just aren't my cup of tea.

  3. #3
    Join Date
    Dec 2006
    Posts
    12
    Quote Originally Posted by ahefner33 View Post
    Hello all.


    When most of you analyze your charts and set your (support/resistance), do you use Fibo. retracements and if yes what time frame do you usually observe this in or initially set it too? I have been trying to set it on daily charts (Metatrader 4) and then going back to H1 to read where it might go. Maybe my understanding on how to read this isnt as up to par as it should and I have read in baby pips school several times about Fibo but that is why I am here asking because I am still confused.

    Also as for targets how are you guys setting these and making your scenarios with your possible targets? I know Fibo Extensions was mentioned in the school about profit targets, but my sofware (MT4) only has Fibo Expansions. Is this the same indicator? Also when messing around with this I would set this by the rules of setting it up and the levels would be so far away it would not even be on my screen so I would not be able to even see where these levels occur at? Any help would be greatly appreciated and many reps to everyone who is helpful. Thanks in advance!

    ahefner33
    I use Fib Retrace and Extent. alot. I think Extention and Expansion refer to the same meaning.
    I look at at least six month period of dayly charts to get the big picture (1 year is better) and identify Swing High and Swing Low points. Find the Fib Levels, and than use them in my hourly chart.

    I will try to explain the use of that indicator.
    Say, when I,m sure that an uptrend has ended, and a new significant swing low has formed (usu. by a steep 'v' shape), I would expect that the following trend will be either a retracement or an extention of the uptrend.
    When the swing high of the trnd is the highest point on that 1 year daily chart, most likely a retracement will occur instead of an extension. If it is like in the middle, expect either one to happen.

    Extension Levels are not on the screen if the swing high is on top of the charts (of course), cause those levels are the levels above the uptrend that has just ended that we expect to be reached on the next uptrend, that's why we use it to determine the coming profit levels. Just jot downs the number for your later reference, cause those levels wil take quite sometimes to finish through.

    One thing that I used to be screwed up is :
    The price levels retrace up and extend up are the high point of the waves.
    The price levels for retrace down or extend down are the lowest points of the waves.

    Hopefully this explanation helps.

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