mrameshfca

FIBONACCI RETRACEMENT POINT TO CONSIDER

Short
NSE:NIFTY   Nifty 50 Index
Dear all
I wish to give you some important points to consider while you are applying Fibonacci retracement .
fibonacci retracement is a beautiful tool to know the target and supporting and resistance levels in a given day
But i have seen some wrong conceptions in fixing the fibonacci retracement levels in a given day.
Unless otherwise the fibonacci retracements are properly fixed it will never give you the correct indications to fix the trade (BOTH ENTRY AND EXIT)
Some people say that fibonacci levels to be fixed to the previous high and low. But it is a million dollar question that what is previous low and high, whether the previous day' or previous month or previous year.
It will be irrelevant to fix the previous high and low whether it may be previous day or previous month or if somebody says immediate high low then how to fix the fibonacci retracement .
HERE also comes the "Theory of Consolidation". To decide the current day trades the fibonacci levels to be fixed on the first bar of the current day. As per my theory the fibonacci retracement should be fixed on the high and low of the first one hour candle, provided the first one hour candle should pass through minimum two consolidation lines.
My theory is based on current trading session movements. The previous highs and lows doesn't have any significance or relevance to the current session market movements. The current session market moves are based on the current session opening candle (one hour candle (9.15 AM to 10.15AM candle).
The important fibonacci level is 38.2% comparing to other fibonacci levels such as 61.8% and 50% levels. In the bullish trend if the market comes down for correction in intraday the market will take support at 38.2% i can show you many examples in Nifty charts and crudeoil and natural gas charts.

comment me for any clarifications

The above chart not re;ated to this idea




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