Difference between Fibonacci Retracement Levels and Fibonacci Extension Levels
How Do I Read the Difference between Fibonacci Retracement Levels and Fibonacci Extension Levels in XAUUSD Trading?
Fibonacci Retracement Levels in XAUUSD Trading
Fib retracement is drawn between 2 chart points but Fib extension is plotted using three chart points.
Fibonacci Retracement Level xauusd trading example illustrated and explained below where the gold trend is moving down between Gold Chart point 1 and Gold Chart point 2, then after Gold Chart point 2 the xauusd price retraces then it continues heading upwards in the original upward trend. Note that this Fibonacci Retracement Levels indicator is drawn from Gold Chart point 1 to Gold Chart point 2 in direction of the trend.
Fibo Retracement Levels - How Do I Draw Fibonacci Retracement Levels
Fibonacci Extension Levels in XAUUSD Trading
Fib retracement is drawn between 2 chart points but Fib extension is plotted using three chart points.
To draw these Fibo Extension levels we wait until the xauusd price retracement is complete & the price starts to move in original direction of the Gold trend. Where the xauusd price retracement reaches is used as chart point 3 for fibonacci extension in xauusd trading.
The Fibonacci Extension xauusd trading examples illustrated and described below shows the Three gold chart Points where the Fibonacci Extension indicator is drawn, marked as chart points 1, 2 and 3. Gold Chart point 1 is where the gold trend started, Gold Chart point 2 is where the gold trend pulled back & retraced and Gold Chart point 3 is where the price retracement reached as shown on the Fibonacci Extension xauusd example illustrated & explained below.
Fibo Extension Levels - How Do You Draw Fibonacci Extension Zones
Please note where these Fibo Extension areas are drawn - Fibonacci Extension zones are drawn above the Fibo Extension indicator, these are the points where a trader will set the gold take profit orders.
Interpret the Difference between Fibonacci Retracement Levels and Fibonacci Extension Levels in Gold Trading?
