How to Draw CFD Fibonacci Extension

How Do You Use CFD Fibonacci Extension Areas Technical Indicator on CFD Chart?

We use CFD Fibo Extension Levels to estimate where the cfd trend movement will reach. There are Two important CFD Fibo Extension areas: 61.80% & 100% CFD Fibo Extension Areas, these are used for taking profit.

To draw CFD Fibonacci Extension levels on the cfds chart we wait until the cfds price retracement is complete & the cfds price starts to move in the original direction of the CFD trend. Where the cfds price retracement reaches is used as chart point 3. CFD Fibo Extension Technical Indicator is plotted using 3 chart points as shown on the cfd examples displayed below of how to plot the CFD Fibo Extension Technical Indicator Tool.

The CFD Fibo Extension example displayed below shows the 3 Chart Points where the CFD Fibonacci Extension technical indicator is drawn, marked as Chart point 1, Chart point 2 & Chart point 3.

Chart point 1 is where the cfd trend started, Chart point 2 is where the cfd trend pulled back & retraced & Chart point 3 is where the cfd retracement reached as shown on the CFD Fibonacci Extension Technical Indicator Tool example shown below.

How to Trade With CFD Fibonacci Extension - How to Draw CFD Fibonacci Extension Levels on CFD Charts

Please note where these CFD Fib Extension areas are plotted - CFD Fib Extension levels are drawn above the Fibonacci indicator, these are the chart points where a trader will set the takeprofit orders using these CFD Fibo Extension Levels - 61.80% & 100.00% CFD Fibo Extension Areas.

Drawing CFD Fibonacci Extension Levels Technical Indicator on an Upward CFD Trend

We use CFD Fibo Extension Levels to estimate where the cfd trend movement will reach. There are Two important CFD Fibo Extension areas: 61.8%CFD Fibo Extension Level & 100% CFD Fib Extension Level, these CFD Fib Extension Areas are used for taking profit.

On the CFD Fibonacci Extension indicator example illustrated & shown below you can see that the CFD Fibonacci Extension technical indicator is plotted along the direction of the cfd trend, since the cfd trend is upward - the CFD Fibo Extension technical indicator is plotted upward.

These CFD Fibo Extension levels are shown as horizontal lines above the CFD Fibo Extension technical indicator, showing the profit taking areas. In the cfd examples shown below if you had used of 100.0% CFD Fibo Extension level you would have made a nice profit from using this trading setup.

Drawing CFD Fibonacci Extension Indicator on an Upward CFD Trend - CFD Fibonacci Extension Trading Tool

From the above CFD Fibonacci Extension indicator examples, the upwards cfd trend continued & both 61.80% & 100.0% CFD Fibo Extension levels were all hit after which cfds price retraced again after getting to the 100.0% CFD Fibonacci Extension level.

Drawing CFDs Fib Extension Levels Technical Indicator on a Downward CFDs Trend

Since we use the CFD Fibonacci Extension indicator tool to estimate take profit levels, how do we draw CFD Fibonacci Extension in a downward CFD trend?

We draw the CFD Fibonacci Extension tool from chart point 1 to chart point 2 to chart point 3 as shown on the cfd examples shown below. Remember we always plot this CFD Fibonacci Extension tool in direction of the cfds trend. In the CFD Fibonacci Extension example shown below, can you figure what direction we have plotted it? That's right - downwards direction.

Try and spot difference between how we have drawn CFD Fibo Extension technical indicator above & how CFD Fibo Extension technical indicator is plotted below. This time you would also have used CFD Fibonacci Extension level 100.0%, just where the cfds price reached as illustrated on the cfd example shown below. That would have been a good take profit area.

Drawing CFD Fibonacci Extension Indicator on a Downward CFD Trend - CFD Fibonacci Extension Trading Tool

From the CFD Fibonacci Extension indicator example above, after plotting this CFD Fibo Extension tool there are two levels which are used to show the profit taking areas, these two CFD Fibo Extension areas are plotted as horizontal lines across the cfds price chart marked as 61.8%CFD Fibo Extension Level & 100% CFD Fib Extension Level.