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Chapter 10, Part VI. Combination of Fibonacci levels with candle patterns.

Discussion in 'Complete Trading Education- Forex Military School' started by Administrator, Jun 21, 2011.

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  1. Administrator

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    Part VI. Combination of Fibonacci levels with candle patterns. [​IMG]
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    Commander in Pips: Another tool that could give you a prompt about whether some Fibonacci level will hold or not is candlestick patterns. There is not much to say, just let’s see, how it looks like.

    Commander in Pips:Here is the GBP/USD weekly chart and the 2008 collapse. Let’s assume that after such strong move down you intend to enter short, but don’t know yet, from which level to do that:


    Chart #1 GBP/USD Weekly | 2008 Collapse
    [​IMG]

    Pipruit: Well, after such strong move down, I think I prefer to enter from 0.382 level. But here I do not see any confirmations from any trend line or resistance lines that we’ve discussed in previous part. So, my confidence with 0.382 level is not so strong.

    Commander in Pips: Right. So, let’s see what has happened, if you’ve entered short from 0.382 level. Share your thoughts about the candles that you see around 0.382 level:

    Chart #2
    [​IMG]


    Pipruit: Ok. First, I see strong white candle that is almost Marubozu - it has very small shadows. This candle assumes continuation of the move up and this fact forces me to wait and not to enter right from 0.382 resistance. Then I see, that this has happened – the market has passed through this level with a small white candle. Then I see the appearance of a Shooting Star pattern, but now I do not have necessary context for entering from Fibonacci levels, because this pattern has appeareded somewhere between the 0.382 and the 0.5 area. We need a resistance that has been confirmed by a candlestick pattern. So, I think that I will stay flat.​
     
    #1 Administrator, Jun 21, 2011
    Lasted edited by : Mar 6, 2016
    Hamza Samiullah and fran alvarez like this.
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