Author:
Margot Robbins
Last Updated on:
02/07/2025
Topic:
Trading
Step by step guide – how to use a Forex Fibonacci strategy to make a profit
1. Pullback trade
A pullback is when there is a momentary lull or drop in a trades trend. This strategy works perfectly for a Forex Fibonacci trading strategy, as Forex Fibonacci levels are always halting or dropping. So, first of all, identify a strong Forex trend. This is a trend that has consistent highs, with a pullback rate of under 50%. After viewing the trade for a while, study how the trade moves around the 38.2% retracement level. Once it starts to drop off, enter the trade. All you have to do now is hold your position, and use the previous highs as an indicator as to when to leave the trade with maximised profit. Our Capex.com platform is as smooth as can be, so as soon as you hit that level, and there’s a drop off, you’ll be able to enter automatically – or, manually, if you value that control.
2. Breakout trades
Breakout trades are when you enter a trade that is rapidly rising outside of support or resistance levels. These are highly risky trades to deal with, and have the highest failure rates out of all online trading strategies. But, with the right Forex Fibonacci levels and our reliable CAPEX.com stop losses, this is a trade that can easily work for Fibonacci retracements. In order to get the most out of a breakout trade, we’d recommend you enter the trade at the very start of its volatility. Once there, Fibonacci extension levels are your friend. Use the addons to know when to clear the trade – when it has cleared 100% retracement – and once that is done, you just have to make sure it reaches the breakout level, and leave quickly. But, make sure it has not retracted more than 38.2% of the previous swing. This could lead to a disastrous loss.
3. Trading with MACD (Moving Average Convergence Divergence)
A MACDs function is that it shows the relationship between two moving averages of a trade’s price. It works well with a Forex Fibonacci trading strategy, because an MACD can locate entry and exit points while the Fibonacci retracements locate the shifts in the trends position. When you match up a bullish MACD indicator with a Forex Fibonacci trading strategy on any Forex trade, the MACD will locate the best points to enter the trade right as certain Fibonacci retracements are just about to rise. Conversely, if you match up a bearish MACD indicator with a Forex Fibonacci trading strategy, the MACD will locate the best points to close a trade right when Fibonacci retracements are about to plummet. Ultimately, using other tools and indicators is smart, and we have plenty of indicators available on our CAPEX.com trading platform. A MACD will align perfectly with your Forex Fibonacci trading strategy.
Conclusion – An accurate and reliable trading tool
All in all, a Forex Fibonacci trading strategy can definitely yield you some great results focusing on a volatile market like Forex. There is no indicator more accurate than determining when a price will suddenly shift trends, and implementing its system can be easy to do once you have an understanding of the Fibonacci sequence. You also have free reign to use other indicators with your Fibonacci retracements, as well as maximising profit by using it during breakout and pullback trades. It’s such a versatile instrument, that if you sign up to CAPEX.com now and implement it, you’ll see profit.
Forex Fibonacci Strategy – FAQ
🤔 How powerful are the Fibonacci levels?
🤷Where should Fibonacci be placed?
👀 Why do Fibonacci levels work?
