How Do I Draw XAUUSD Trading Fib Expansion Levels?
How Do I Draw XAUUSD Trading Fib Expansion Levels?
Traders use Fibonacci expansion levels to estimate where the trend movement will reach. There are two commonly used Fibonacci expansion levels - 61.8% Fibonacci Expansion Level and 100% Fibonacci Expansion Levels, these fibonacci expansion levels are used for setting gold take profit levels.
To draw Fibo Expansion levels on the gold chart we wait until the xauusd price retracement is complete & the price starts to move in original direction of the trend. Where the xauusd price retracement reaches is used as chart point 3. Fibonacci Expansion Gold Indicator is drawn using three chart points as illustrated on the Fib expansion xauusd examples illustrated & explained below of how to draw the Fibonacci Expansion Technical Indicator Tool.
The Fibonacci expansion example illustrated and explained below shows the 3 XAUUSD Chart Points where the Fibonacci expansion xauusd technical indicator is drawn, marked as XAUUSD Chart point 1, XAUUSD Chart point 2 and XAUUSD Chart point 3.
XAUUSD Chart point 1 is where the gold trend started, XAUUSD Chart point 2 is where the gold trend pulled back & retraced & XAUUSD Chart point 3 is where the gold retracement reached as illustrated on the Fibonacci Expansion Indicator Tool examples illustrated and described below.
How Do I Draw Fibonacci Expansion Levels? - How Do I Draw Fibonacci Expansion Levels?
Please note where these Fibonacci Expansion zones are drawn - Fibonacci Expansion zones are plotted above the Fibonacci gold technical indicator, these are the chart points where a trader will set gold take profit orders using these Fibonacci Expansion Levels - 61.8% & 100.0% Fibo Expansion Levels.
Drawing Fibonacci Expansion Levels on an Upward Gold Trend
We use Fibonacci expansion levels to estimate where the market trend movement will reach. There are two commonly used Fibonacci expansion levels: 61.8% XAUUSD Fibo Expansion Level & 100% Fibo Expansion Level, these Fibonacci Expansion Levels are used for taking profit.
On the Fibonacci expansion indicator example illustrated and explained below you can see that the Fibonacci expansion technical indicator tool is drawn along the direction of the trend, since the trend is upwards - the Fibonacci expansion levels indicator is drawn upward.
These Fibonacci expansion levels are displayed as horizontal lines above Fibonacci Expansion Indicator, showing gold profit taking areas. In the xauusd example illustrated & described below if you had used the 100.00% Fibo expansion level the you would have made a good profit from this trade setup.
Drawing Fibonacci Expansion Zones Technical Indicator on an Upward Gold Trend
From the above Fibo expansion indicator examples, the upward trend continued and both 61.80% and 100.0% Fibo expansion levels were all hit after which xauusd price retraced again after getting to the 100.00% Fibonacci Expansion level.
Drawing Fibonacci Expansion Levels on a Downwards Gold Trend
Since we use the Fibonacci expansion indicator tool to estimate gold take profit levels, how do we draw Fibonacci Expansion in a downward Gold trend?
We draw the Fibonacci expansion indicator tool from chart point 1 to chart point 2 to chart point 3 as illustrated on the Fibonacci expansion xauusd examples illustrated & explained below. Remember we always draw this Fibo expansion tool in direction of the trend. In the Fibonacci expansion examples illustrated & described below, can you determine what direction we have drawn it? That's right - downwards direction.
Try and spot the difference between how we have plotted Fibonacci expansion levels indicator above and how Fibonacci Expansion levels indicator is drawn below. This time you would also have used Fibonacci expansion level 100.0%, just where the price reached as shown on the Fibonacci expansion levels xauusd trading example illustrated and explained below. This would have been a good gold take profit area.
Drawing Fibonacci Expansion Zones Technical Indicator on a Downward Gold Trend
From the Fibonacci expansion levels indicator example above, after drawing this Fibonacci expansion levels gold trading tool there are 2 levels which are used to show the gold profit taking areas - these two Fibonacci expansion levels are drawn as horizontal lines across the xauusd price chart marked as 61.8% XAUUSD Trading Fib Expansion Level & 100% Fibo Expansion Level.
How Do I Draw Fibonacci Expansion Levels
