How Do I Calculate Fibonacci Extension Levels?
To Calculate Fibonacci Extension levels on gold charts we use the Fibonacci Extension Indicator
What are the Fibonacci Extension Levels?
- 61.8% Fibonacci Extension Level
- 100% Fibonacci Extension Level
We use Fibonacci expansion levels to estimate where the price movement will reach. There are 2 important fibonacci expansion levels; 61.8% and 100% Fibonacci Extension levels, these level are used for taking profit.
To draw Fibonacci expansion we use 3 chart points.
To draw Fibonacci extension levels we wait until the xauusd trading price retracement is complete and xauusd trading price starts to move in the original direction of the Gold trend. Where the retracement reaches is used as point 3.
The example illustrated and explained below shows the 3 Chart Points where the Fibonacci extension indicator is drawn, marked as chart point 1, 2 and 3. Chart point 1 is where the price gold trend started, Chart point 2 is where the price gold trend retraced and chart point 3 is where the price retracement reached as shown on the xauusd trading example illustrated and explained below.
How Do I Calculate Fibonacci Extension Levels on Gold Charts?
The two Fibonacci extension levels 61.8% and 100% Fibonacci Extension levels were then drawn above the Fibonacci Extension Indicator as shown on the xauusd trading example above.
