Fibonacci and Pivot Points by THUẬN-TB

Setup 1: Combining Fibonacci Retracement with Trend Lines
This setup helps identify potential entry points when the price retraces to significant Fibonacci levels and, at the same time, touches a trend line.

Identify the trend: First, you need to determine the main market trend (up or down). In an uptrend, the price typically creates higher highs and higher lows. Conversely, in a downtrend, the price makes lower highs and lower lows.

Draw the Fibonacci Retracement: After identifying the trend, draw the Fibonacci Retracement tool.

For an uptrend: Drag from the lowest swing low to the highest swing high of the most recent upward move.

For a downtrend: Drag from the highest swing high to the lowest swing low of the most recent downward move.

Find the entry point: Wait for the price to retrace to a key Fibonacci level such as 0.382, 0.5, or 0.618. A strong signal is when the price touches one of these levels and simultaneously intersects with the trend line. This combination suggests that the support (or resistance) level is reinforced by two factors.

Place the trade:

For an uptrend: Place a long (buy) order at this confluence point. The stop-loss can be placed below the next Fibonacci level or below the low of the corrective wave.

For a downtrend: Place a short (sell) order at this confluence point. The stop-loss can be placed above the next Fibonacci level or above the high of the corrective wave.

Setup 2: Combining Fibonacci Retracement with Support/Resistance Zones
This setup is based on the principle that Fibonacci levels are stronger when they align with price zones that have acted as support or resistance in the past.

Identify support and resistance zones: Look at the chart to find price areas where the market has reversed or consolidated multiple times. These zones can be previous highs and lows or psychological round numbers.

Draw the Fibonacci Retracement: Similar to the previous setup, draw the Fibonacci Retracement on the main trend wave.

Find the entry point: Wait for the price to retrace to a Fibonacci level (especially 0.5 and 0.618) that also coincides with a significant support or resistance zone. The confluence of these two factors creates a very strong signal, indicating a high probability of a price reversal.

Place the trade:

Enter the trade: Place a buy or sell order at this confluence zone.

Stop-loss: Place the stop-loss below the support zone (for a buy order) or above the resistance zone (for a sell order).

Setup 3: Using Fibonacci Retracement and Fibonacci Extension
This is a more advanced setup that helps you not only find entry points but also determine potential profit targets.

Draw the Fibonacci Retracement: After the price has retraced, use the Fibonacci Retracement tool to find an entry point, as in the previous setups. For example, the price retraces to the 0.618 level.

Draw the Fibonacci Extension (or Expansion): After the price has rebounded from the Fibonacci Retracement level, use the Fibonacci Extension tool.

Draw the extension from 3 points: Start from the beginning of the trend wave, drag to the high (or low), and then drag back to the end of the corrective wave. This tool will automatically display potential target levels.

Determine profit targets: Common Fibonacci Extension levels such as 1.272, 1.618, and 2.618 are often used as profit targets. The 1.618 level, in particular, is a very common and reliable target for many traders.