Definition
The Fibonacci Retracement Indicator automatically draws the Fibonacci levels on the MT4 chart. This removes the “flat market” period from consideration and only considers the stages of active price movement.
| Name | Fibonacci Retracement Indicator |
| Indicator Function | Draws Fibonacci Levels |
| Platform | MT4 |
| File Size | 17.1 KB |
Working of Fibonacci Retracement indicator?
The Fibonacci retracement draws Fibo levels which aid in determining the potential depth of retracement (pullback). The pivot points (or pivots), from which the main trend will probably continue, can be identified using the levels. The Fibonacci Retracement should be used as an addition to your trading system, as well as along with other indicators. The more signals point out that you should open a trade, the higher the odds of a positive trading outcome.
Trading with Fibonacci Retracement
For Trading, always use this indicator with other indicators. Let us say if we use trendline indicator with this indicator, you can see the trendline that represents an additional tool and indicates a trend on chart. The pullback movement suggests the current trends (whether its buying or selling trend) of market through fibo levels. For example, if fibo level is 38.2% it shows a buying trend and you can open a trade at the market price, and Stop Loss should be placed beyond the support line.
The indicator’s levels won’t be redrawing when you change from one timeframe to another. Double-clicking the indication and deleting it will fix this flaw. After then, the indicator will operate automatically on the timeframe you’ve chosen.
The usefulness of the indicator’s levels is its main advantage. The indicator will be helpful in identifying appropriate pivots after pullbacks regardless of the time interval you trade on or the approach you take (scalping, intraday trading, or long-term trading).
Using the Fibo levels, you can also observe the general attitude of players in the Forex market. And since you already know that, you can probably guess where the price will go next.
Conclusions
Fibonacci retracement indicator for MT4 helps in determining support and resistance levels. They received their name because they make use of the Fibonacci sequence. The principle behind Fibonacci retracement is that markets will retrace a predetermined amount of a move before continuing to move in the initial direction.
Download indicator