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Chapter 10, Part III. Advanced talks on Fibonacci Retracement. Page 5

Discussion in 'Complete Trading Education- Forex Military School' started by Sive Morten, Dec 15, 2013.

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  1. Sive Morten

    Sive Morten Special Consultant to the FPA

    Aug 28, 2009
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    Commander in Pips: Well, your answer is correct, but not fully. Here is the correct answer, and you tell me, why is it correct:


    Pipruit: Well, I don’t know, it looks difficult​

    Commander in Pips: Ok, I’ll help you a bit. First of all, I suppose that it’s all clear about your X and A points, right? So, tell me why I’ve marked X’ point and not X1

    Pipruit: Well, because we have to have the same “A” point to mark X’s as X1, X2 and etc. They have to link with the same “A” point. But here A point stands to the left from X’, so it’s not correct (it should be the highest price to the right, i.e. later in time) and “A” point couldn’t be used for building retracement. But still, X’ point corresponds with conditions – “swing low a candlestick/bar that has at least two higher lows on both sides of itself – from left and from right

    Commander in Pips: Definitely. So, as we have X’ point, we should have an “A” point for it also…

    Pipruit: Right, and the only point that is suitable for it is A’. I think I understand it. So, we have two different swings here – X-A, and X’-A’. If we assume that this is daily time frame, then, I probably will use X’-A’ if I’m intraday trader…​

    Commander in Pips: You understand right.

    Pipruit: But Commander, and if after some time price will move higher, and A’ move above A?​

    Commander in Pips: Well, in this case for both X points there will be only single highest “A” point, that will stand to the right from them and we will return to situation, that we’ve just discussed:


    Pipruit: Cool! And do you have some more tasks with that?​

    Commander in Pips: As you wish:


    Pipruit: Well, I see the same swing X-A, that we’ve already discussed and some downside move. Well, if we will treat it as downswing, then we will get the following picture:​


    Commander in Pips: And why is A and X’2 at top?

    Pipruit: Well, A is A-point for X – initial swing up. And X’2 is first X point for swing down X’-A’. X’1 is the second point. It comes that previous A-point could simultaneously be an initial X point for smaller down thrust. At least all these markings correspond to the rules that you’ve given…​
    Hamza Samiullah and fran alvarez like this.
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