Enter The Trend With Fibonacci Retracement
Never try to fight a trend . But still you will find a number of traders try to trade against the trend and losing money fighting the trend . Now, it is possible to make money trading a counter trend move . If you trading against the trend you are only piling the odds against you. Never try to trade against the trend. Always keep this in your mind that trend is your friend and riding the trend at the right time and exiting it at the right time is how fortunes are made in trading . Get these Forex Scalping Cheatsheets plus the 10X Scalping System and the Hot Time Indicator FREE! Download this powerful Forex Swing Trading End of Day Trading Kit (100 page PDF plus Videos) FREE!
Trend can be up or down. When it is up, we call it uptrend and when it is down, we call it downtrend. When it is an uptrend, we will go long at the right time and when it is a downtrend, we are going to go short. Now, you should note what I have said, we will go long or short at the right time or opportunity . Trend trading is one of the most popular trading strategies. It is simple. Just ride the trend at the right time and get out before it reverses itself. Now, you don’t ride a trend in a random or haphazard manner. Trend traders look for the right opportunity to enter the trend. What is that right opportunity? When the market makes a retracement or a pullback .
Now markets never move in a straight line. Price action is always up and down. In case of a trend, price action will make steady higher highs or lower lows . Trends also don’t move in straight lines. In every trend, there can be minor trends. There is a primary trend and then there is a minor trend . So when the trend is having a minor trend that minor trend can be in opposite direction to the primary trend. This minor trend is responsible for the pullback or what you call the retracement in the main trend. So this minor trend can have it’s own support and resistance and when the pullback takes place, it can be at that support or resistance . This pullback can also take place at a Fibonacci Retracement Level. Round numbers often act as the psychological support or resistance as large orders tend to pile up at these levels . Learn a powerful Fibonacci Retracement method FREE that pulls 500+ pips per trade easily!
Fibonacci Retracement Levels can act as a utilitarian guide in determining a point of entrance in a trend . In a trend, the directional move in the market will often tend to retrace itself by a certain percentage points. The most important Fibonacci Retracement Levels are the 38.2%, 50% and 61.8%. Price action often tends to pullback at these levels. These pullback often act as an excellent opportunity to enter in the direction of the trend as the price often tends to seek support or resistance at these levels in a trend .