Hello, and welcome to another episode of technical analysis show for trading binary options. Today I will show you detailed examples of trading while using one of the most basic things – Fibonacci lines. We will learn how to draw the lines, how to use it to trade, but also a neat little trick. An indicator, which draws the line for us.
What are Fibonacci lines?
Figure 1: Connect the local minimum (A) and maximum (B) F.L. tool.
Fibonacci lines are a very popular tool, used by the majority of professional traders. These lines are based on the use of numbers identified by mathematician Leonardo Fibonacci. This series of numbers (0, 23.6, 38.2, 50, 61.8, 100) can be used in trading, because the price often makes reversals at these lines.
The lines are very easy to draw. See Figure 1
Figure 2: The drawn lines
Just use the Fibonacci lines tool and connect those two said points. This gives us something similar to what we can see in the Figure 2
Now we can see that in the vicinity of the aforementioned lines, the price broke (see Figure 3) and (at least short-term) turnover has happened. I will tell you right now how can this be utilized.
Figure 3: Price reversals, which we can use.
How To Trade Binary Options Using The Fibonacci Line?
Check out the Figure 4 We have marked F.L. (Fibonacci lines) thanks to previous swing (orange points A and B) and now we can happily trade. Look at how many opportunities (marked by the blue circle) to trade were provided by the F.L.
Figure 4: Trading
The Best Fibonacci Lines
The best lines on which the turnover almost always occurs are the 0, 50 and the 100 lines.
Author
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I've wanted to build a business of some kind and earn money since I was in middle school. I wasn't very successful though until my senior year in highschool, when I finally started to think about doing online business. Nowadays I profitably trade binary options full-time and thus gladly share my experiences with you. More posts by this author