Auto Fibonacci Level Forex Trading Strategy

The odds are always in your favor when you trade in the direction of the dominant trend and we seek to achieve just that using this strategy.

The Auto Fibonacci Level Forex trading strategy offer traders access to high probability set-ups that are profitable to trade.

This strategy is all about spotting significant support and resistance levels upon gauging critical downward or upward price movement respectively.

Some of the problems traders face is the ability to properly draw Fibonacci levels on the chart.

We have eliminated that problem by using an automated Fibonacci drawing indicator within this strategy.

Chart Setup

MetaTrader4 Indicators: Auto_Fibo.ex4 (Inputs Variable Modified; ZigZag Leg = 4 or ZigZag Leg = 43), stepma-signale.ex4 (Inputs Variable Modified; PdfMaLength = 14), Forex Blau Balance Indicator.ex4 (Default setting)

Preferred Time Frame(s): 1-Minute, 5-Minute, 15-Minutes, 30-Minutes, 1-Hour, 4-Hours, 1-Day, 1-Week

Recommended Trading Sessions: Any

Currency Pairs: Any pair

Download

Download the Auto Fibonacci Level Forex Trading Strategy

Buy Trade Example

Fig. 1.0

Strategy

Long Entry Rules

Enter a bullish trade if the following indicator or chart pattern gets put on display:

  1. If price retraces in a bullish trend and subsequently bounces off a significant support level (23.6% Fibo level) on the Auto_Fibo custom indicator as illustrated on Fig. 1.0, a bullish trend is said to be imminent.
  2. If a dodger blue upward pointing arrow of the stepma-signale Metatrader 4 forex indicator pops up slightly below the candlesticks (see Fig. 1.0), bullish sentiment is said to be dominating the market, as such a buy order will suffice.
  3. If the lime green signal dots of the Forex Blau Balance Indicator pops up within the indicator window as depicted on Fig. 1.0, price is said to be driven higher i.e. a trigger to go long on the selected currency pair.

Stop Loss for Buy Entry: Place stop loss below immediate support.

Exit Strategy/Take Profit for Buy Entry

Exit or take profit from all trades if the following rules or conditions takes precedence:

  1. If price breaks below an immediate support level on the Auto_Fibo indicator while a bullish trend is running, it is signaling a likely weaning bulls power, therefore an exit or take profit is advised.
  2. If the stepma-signale indictor displays a magenta downward pointing arrow while a bullish signal is ongoing, it is a trigger to exit or take profit at once.
  3. If the Forex Blau Balance Indicator displays a red signal dot within its indicator window during a buy alert, it is an indication to exit or take profit straightaway.

Sell Entry Rules

Go short if the following setups gets displayed successfully on the activity chart:

  1. If price retraces during a bearish trend and subsequently bounces off a significant resistance level (61.8% Fibo level) on the Auto_Fibo custom indicator as shown on Fig. 1.1, a bearish trend is said to be in the offing.
  2. If a magenta downward pointing arrow of the stepma-signale indicator pops up somewhat above the candlesticks (refer to Fig. 1.1), bearish sentiment is said to be looming, as such a sell order will do.
  3. If the red signal dots of the Forex Blau Balance Indicator pops up within the indicator window as shown on Fig. 1.1, price is said to be pushed lower i.e. a trigger to go short on the fx pair of choice.

Stop Loss for Sell Entry: Place stop loss above immediate resistance.

Exit Strategy/Take Profit for Sell Entry

Exit or take profit if the following takes center stage:

  1. If price breaks above an immediate resistance level on the Auto_Fibo indicator during a bearish trend, it is signaling a likely halting of bears power, therefore an exit or take profit is recommended.
  2. If the stepma-signale indictor displays a dodger blue upward pointing arrow while a bearish signal is running, it is a trigger to exit or take profit without delay.
  3. If the Forex Blau Balance Indicator displays a lime green signal dot within its indicator window during a sell alert, it is an indication to exit or take profit immediately.

Sell Trade Example

Fig. 1.1

Free Download

Download the Auto Fibonacci Level Forex Trading Strategy

About The Trading Indicators

The Auto_Fibo.ex4 is a technical indicator that automatically draws Fibonacci retracement levels on the activity chart.

The stepma-signale.ex4 is a Metatrader 4 indicator that is built on the moving averages and does well in gauging trends.

The Forex Blau Balance Indicator.ex4 is a trend-following moving average signal indicator.

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