What is Fibonacci 50?
Fibonacci 50 is a profit-taking technique adapted from the Fibonacci Retracement tool, but it differs from the standard usage. This method uses specific significant Fibonacci levels, particularly the 50% level, as entry and exit points for making profitable trades.
How to Activate Fibonacci 50
You can activate it on platforms like MT4, MT5, or TradingView. Personally, I prefer using it on TradingView because it’s simple and user-friendly. Just select the Fibonacci Retracement tool, customize the line colors to your preference, and use the levels 0, 0.5, and 1.
Using Fibonacci 50 for Profit-Making
Start by identifying the Swing High and Swing Low from the candlesticks before the current candlestick on the D1 timeframe. Then, draw the Fibonacci 50 from the Swing High to the Swing Low to find an entry point for trading that day. After that, lower the timeframe to identify the best entry opportunity.
Buy Entry Signal
If you lower the timeframe and the price breaks above the 0.5 Fibonacci level into the upper zone, you can place a Buy order.
Sell Entry Signal
Conversely, if you lower the timeframe and the price breaks below the 0.5 Fibonacci level into the lower zone, you can enter a Sell order.
Trading with Fibonacci 50 can help traders enter orders quite frequently because lowering the timeframe allows Fibonacci 50 to provide more accurate and frequent profit signals. It also offers very tight stop-loss (SL) points, making it ideal for scalpers who like to take small, quick profits but accumulate gains often.
