What is the .382 Fibonacci ratio in forex trading?

What is the .382 Fibonacci ratio in forex trading?

It was mentioned in the past article that Fibonacci forex trading is the basis of many forex trading systems used around the world by profitable forex traders. These systems are all based on the famous Fibonacci ratios (.236, .50, .382, .618, etc.) and each of them can specialize in a particular ratio along with other minor indicators in order to make the lighting at the entrance and exit levels how accurate and profitable as possible.

One of the widely used Fibonacci ratios is the 0.382 ratio. As can be easily seen on any forex chart, currency prices are constantly changing and they follow an oscillatory pattern with peaks and valleys. The border at the top is usually called resistance level while the valley is usually called a support.

In order to find the 0.382 ratio level what you do is, first, measuring the size of the fall or rise over your time of interest. Once you have that value you multiply this by 0.382. Now depending on what is seen, an increase or decrease the price of the particular "currency pair" you are trading, will be added to the final value will be calculated on the total decline in value or subtract from the total increase.

These activities will give you the 0.382 Fibonacci ratio level, either for growth or decline of the table will be analyzed. Once you have value then you can start planning the strategy to follow in order to make a high probability profit from this valuable information. For the 0.382 ratio level calculated for the recent increase in "currency pair" exchange price, your calculated level will probably be much support for the case of the level calculated for the recent decline in the prices your level will probably be much resistance.

Knowing this ahead of the market and with the appropriate secondary indicators, will give you a huge advantage over most forex traders, and that's something any trader would like they can count on. That's why Fibonacci trading is so widely accepted around the world, and of course, why it is so profitable and successful.

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