Metals Trading Retracement Strategy
How Do I Use Metal Trading Fibonacci in Metal Trading?
A good metals trading retracement strategy to use is the fibonacci retracement indicator. Fibonacci retracement indicator is used by many metals traders as a metals retracement strategy trading indicator tool.
The fibonacci retracement indicator is placed on a metals chart and this Metals Trading Fibonacci Retracement indicator then calculates the retracement levels on the metals trading charts.
Metal Trading Fibonacci Retracement Strategy Examples on Upward Metal Trading Trend and Downwards Metal Trend
Metal Trading Retracement Strategy
In the Metals Trading Retracement Strategy example illustrated and explained below the metals price is moving up between chart point 1 & chart point 2 then after chart point 2 it retraces down to 50.0% retracement level then metals price continues moving up in the original upward metal trend. Note that this metals retracement indicator is plotted from point 1 to point 2 in the direction of the Metals trend (Upwards Direction).
Because we know this is just a retracement based on our metals chart metals trend - using this retracement indicator, we put a buy order just between the levels 38.2% and 50.0% & our stop-loss just below 61.8% pull back mark. If you had put buy at this point in trade example illustrated and explained below you would have made a lot of pips after the metals price retracement reached the Fibonacci 50.0% level and then continued moving in the original upward metal trend.
How to Trade Retracement on Upward Metals Trend - Metals Trading Retracement Strategy
Explanation for the Above Metals Trading Retracement Strategy Examples
Once the metals price hit the 50.0% retracement level, this retracement level provided a lot of support for the metals price, and afterward metal market then resumed the original upwards metals trend & continued to move up.
23.60% retracement level provides minimum support and is not an ideal place to place a metals trading order.
38.20% retracement level provides some support but metals price in this example continued to retrace upto the 50% zone.
50.00% retracement level provides a lot of support and in this example, this was the ideal place to place a buy metals trading order.
For this Metals Trading Retracement Strategy example, the metals price retracement reached the 50.0% retracement level, but most of the time the metal market will retrace up to 38.2% retracement level and therefore most of the time metals traders set their buy limit metals orders at the 38.2% Fibonacci retracement level, while at the same time placing a stop just below 61.8% Fibonacci retracement level.
Metal Trading Retracement Strategy
In the Metals Trading Retracement Strategy example illustrated and explained below the metal market is moving downwards between chart point 1 & chart point 2, then after chart point 2 the metals price then retraces up to 38.2% retracement level then it continues heading downwards in the original downward metal trend. Note that this metals retracement indicator is plotted from point 1 to point 2 in the direction of the Metals trend (Downwards Direction).
Because we know this is just a retracement based on the metals chart metals trend we put a sell order at 38.2% retracement level and a stop loss just above 61.8% retracement level.
If you had put sell order at the 38.2% retracement level as shown on the trade below you would have made a lot of pips afterwards after the metals price reached the 38.2% retracement level and then resumed the downward metal trend.
In this trade the retracement of metals price reached 38.20% retracement level & did not get to 50.00% retracement level. It is always good to use 38.20% retracement level because most times the metals price retracement doesn't always get to 50.0% retracement level.
How to Trade Retracement on Downwards Metals Trend - Metals Trading Retracement Strategy
Explanation for the Above Metal Trading Retracement Strategy Examples
The above Metals Trading Retracement Strategy example is a metals retracement trading setup where the metals price retraces immediately after touching the 38.2% Metal Chart Fibo Retracement Level.
This Metals Trading Retracement level provided a lot of resistance for the metals price retracement, this was the best place for a trader to place a sell limit metals order as the metal market quickly moved down after hitting this retracement level.
