Fibonacci Retracement is not an easy thing
Fibonacci Retracement Is Not Easy , As we have learned before that we can easily use Fibonacci retracement to determine support and resistance areas. So we can easily determine whether to open an order with BUY or SELL. But in reality this is not easy to do the following is an example.
Based on the downtrend GBPUSD price trend you can use the Fibonacci retracement tool to determine the support and resistance by determining the Swing High point at 1.5383 and Swing Low at 1.4799.
After waiting for so long you see that the price position is at the 50% level and the right time to open a SELL position based on the movement of the GBPUSD currency pair. And you start dreaming that you will get a lot of money and will buy everything you need.
But in reality this will make you lose money especially if you don’t apply risk management in forex trading. The following is what happens to price movements above the next.
Well it turns out that price movements continue to rally until it can break the 50% level to the Swing High point.
So, what can we learn from this price movement?
So, when the Fibonacci retracement level provides a great opportunity to gain profits in forex trading but keep in mind that this tool does not always work correctly. So we have to combine it with other tools to minimize the risk of error because no one knows for sure where the price will move and all we can do is just guess it.