Fibonacci Spirals - How to use them in daily trading
Fibonacci - is well known to use for support and resistance in so many charts.
Many traders use them as an easy guide for making decisions for entry and exits.
Some traders do not know about how to set up Fibonacci in their charts.
But use them anyway.
I was not using the Fibonacci line indicator in my charts to make decisions.
I found it very handy to use the Fibonacci Spiral for some of my bigger
pictures of price development. It came out that this one is EASY to read!
Of course spirals are not seen in public charts often. Because there are
not many chart programs providing them. So I decided
to start a thread especially on the Fibonacci Spiral Indicator.
Why is this thread in the Journal Section?
My intention is to use the Fibonacci Spiral with my daily Dax trading.
Therefore I will update the upcoming months with the bigger picture
using this indicator. It will be some learning thread with real charts
of the actual Dax future. The more examples are fixed the more it
will show if this indicator which I use for years can have some positive
effect on your trading.
The following 6 users say Thank You to GFIs1 for this post:
You have seen in last post the indicator - and where the price is moving
along with the lines - or crossing simply between the spiral lines.
Amazing - isn't it?
In above sample I had set up a SHORT spiral.
How is this done?
We need to start at a new high - and search for the next low to fix the
On a short spiral setting the lines need to turn COUNTERclockWISE.
As shown in the chart - the spiral turned first circle at around 9750.
But price went further to the red line - the one after the first circle.
Exactly the place to stop the short @ around 9650 and go long.
Along the the red line...
The consecutive trades can be read out from the chart.
NOW FOR THE LONGS
the situation is exactly opposite: Starting from a new low we draw
the spiral to the first high and its reversal...
But this time CLOCKWISE...
More to come soon.
The following 4 users say Thank You to GFIs1 for this post:
To not show many elements disturbing in the chart here for this special thread
I eliminated all not necessary parts.
Only left are the Ichimoku Cloud which indicates always some "middle" of the
The Spiral is extra thick to show the important colors of the turnings as well.
Some numbers, "!" and the red diamond are part of the Walzer system known
from my other thread. Those do not interfere with the theme here.
The fib spiral tool is perhaps the most elegantly simple and yet powerful fib tool, in part because of its single-handed representation of the 1.618 ratio and nothing else. Additionally, the manner it does so provides key points not only in price but time as well!
You are correct that there are very few charts packages that offer the spiral, in part because I think the freemasons who control the market don't want the average joe to use it (kidding), no actually, I'm not sure why.
ThinkorSwim has a fib spiral tool, BUT, it doesn't really work correctly. The thing about the tool is that I believe it can only work correctly on a chart that is SQUARED. Is that correct? Is your chart squared? And for that matter, what package are you using?
The following 3 users say Thank You to srgtroy for this post:
I use Investor/RT from Linnsoft.
The chart needs do be squared. Any distortion and the spiral does not sit correct on underlying data.
You are right that time on this fib tool is also very important.
Some regular "update" or setting a new spiral from the next bigger turning point is necessary.
But the results are very good and the trader "sees" what the market is playing out.
The following 2 users say Thank You to GFIs1 for this post: