The question is how do you trade Fibos ? You have calculated the exact point here. Then it moves a tick above or below and then whipsaws and non defined vola how often do you then reverse your position ? So you add 3% above and below as extra stop here ? Does it work really ? How often then you get stopped out ? Again what is your overall profitability here on Fibs ?
Fibs don't work
- Thread starter SunTrader
- Start date
You are not understanding how trading fibs work. It is not a stand alone trading system. Fibs are just a view of the market that offers potential support and resistance levels. A Fib level that is blown through is just as important an observation as one that is respected. You use it to help in trading decisions when a fib level holds.
But what is a level ? It is certain point, exact point measured on Fibo. So how much do you allow then to move up and above that exact point to be a so called additional indicator for your trading ? Just imagine it moves 1 point or 2 pips above and below 10 times. What do you do ?
I can understand it if you use Fibs as exit point where you have your stoploss or takeprofit. Once it is hit then it is exit. But for entries ?
A level is the key Fib retracement percentages. 38.2% 61.8% etc from a swing low to swing high or swing high to swing low. If you don't know how to put a fib retracement on your chart then study your platform that you are using.
Check out suntrader's charts that he has posted. Excellent potential entries all on one chart when a fib level is respected and rejected.
I know Fibos as I have backtested retracements but with not good results at all. That is why I am curious anyone can explain they are really good working ? Tell me something about your stats when trading with Fibos ?
It still can bounce several times or 10 times to non defined swings above and below any Fibo level. So how do you do that when trading it ? You could get many whipsaws here, which can cost you a lot of money, especially in choppy markets.
Again I do not mind hindsight charts, I only do backtests and then going walk-foward to see if there is an edge. I could not find any edge here.
You can't establish "stats" on as it is just one of your tools. There is not a magic bullet in trading and Fibs is not a trading system. Just use it for what it is ---- potential support and resistance levels.