How to Draw Commodity Trading Fib Extension
How Do I Use Commodity Trading Fib Extension Areas Technical Indicator on Commodity Trading Chart?
We use Commodity Trading Fibo Extension Levels to estimate where the commodity trend movement will reach. There are Two important Commodity Trading Fib Extension areas: 61.8% and 100% Commodity Trading Fib Extension Levels, these are used for profit taking.
To draw Commodity Trading Fib Extension levels on commodities chart we wait until the commodities trading price retracement is complete and commodities trading price starts to move in original direction of the Commodities trend. Where the commodities trading price retracement reaches is used as chart point 3. Commodity Trading Fib Extension Trading Indicator is plotted using three chart points as shown and illustrated on the commodity example illustrated and explained below of how to plot the Commodity Trading Fib Extension Trading Indicator Tool.
The Commodity Trading Fib Extension example illustrated & described below shows the Three Chart Points where the Commodity Fibonacci Extension technical indicator is plotted, marked as Chart point 1, Chart point 2 & Chart point 3.
Chart point 1 is where the commodity trend started, Chart point 2 is where the commodity trend pulled back & retraced and Chart point 3 is where the commodity retracement reached as displayed on the Commodity Fibo Extension Technical Indicator Tool example illustrated & explained below.
How to Trade With Commodity Fibonacci Extension - How to Draw Commodities Trading Fib Extension Areas Technical Indicator on Commodity Trading Charts
Please note where these Commodity Trading Fib Extension areas are plotted - Commodity Trading Fib Extension levels are drawn above the Fibonacci indicator, these are the chart points where a trader will set the takeprofit orders using these Commodity Trading Fib Extension Levels - 61.8% and 100.0% Commodity Trading Fib Extension Areas.
Drawing Commodities Trading Fib Extension Areas Technical Indicator on an Upwards Commodities Trend
We use Commodity Trading Fibo Extension Levels to estimate where the commodity trend movement will reach. There are Two important Commodity Trading Fib Extension areas: 61.8%Commodity Trading Fib Extension Level and 100% Commodity Trading Fib Extension Level, these Commodity Trading Fib Extension Levels are used for profit taking.
On the Commodity Trading Fib Extension indicator example illustrated and explained below you can see that the Commodity Fibo Extension technical indicator tool is plotted along the direction of the commodity trend, since the commodity trend is upwards - the Commodity Trading Fib Extension technical indicator is plotted upwards.
These Commodity Trading Fib Extension levels are shown as horizontal lines above the Commodity Trading Fib Extension technical indicator, showing the profit taking areas. In the commodity example illustrated and explained below if you had used of 100.0% Commodity Trading Fib Extension level the you would have made good profit from the trade set up.
Drawing Commodity Trading Fibo Extension Technical Indicator on an Upwards Commodities Trend - Commodity Trading Fib Extension Trading Tool
From the above Commodity Trading Fib Extension indicator example, the upward commodity trend continued & both 61.80% and 100.00% Commodity Trading Fib Extension levels were all hit after which commodities trading price retraced again after getting to the 100.00% Commodity Trading Fibo Extension level.
Drawing Commodity Trading Fib Extension Levels Technical Indicator on a Downwards Commodities Trend
Since we use the Commodity Trading Fib Extension indicator tool to estimate take profit levels, how do we draw Commodity Fibonacci Extension in a downwards Commodities trend?
We draw the Commodity Trading Fib Extension indicator from chart point 1 to chart point 2 to chart point Three as shown and illustrated on the commodity example illustrated and explained below. Remember we always plot this Commodity Trading Fib Extension tool in direction of the commodities trend. In the Commodity Trading Fib Extension example illustrated and explained below, can you figure what is the direction we have drawn it? That is right - downwards direction.
Try and identify the difference between how we have plotted Commodity Trading Fib Extension technical indicator above and how Commodity Trading Fib Extension technical indicator is plotted below. This time you would also have used Commodity Trading Fib Extension level 100.0%, just where the commodities trading price reached as shown on the commodity example illustrated and explained below. That would have been a good take profit area.
Drawing Commodity Trading Fibo Extension Technical Indicator on a Downward Commodities Trend - Commodity Trading Fib Extension Trading Tool
From the Commodity Trading Fib Extension indicator example above, after plotting this Commodity Trading Fib Extension tool there are two levels which are used to show profit taking areas, these two Commodity Trading Fib Extension areas are plotted represented as horizontal lines across the commodities trading price chart marked as 61.8%Commodity Trading Fib Extension Level and 100% Commodity Fibo Extension Level.
