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How Do You Interpret Fibonacci Extensions in Bitcoin Trading?

Bitcoin Trade Fib Extensions in Bitcoin Trading

Fibonacci extension levels btcusd crypto technical indicator is drawn using 3 bitcoin chart points.

To draw Fibo Extension levels we wait until the bitcoin price retracement is complete & the bitcoin price starts to move in the original direction of the Bitcoin trend. Where the bitcoin price retracement reaches is used as cryptocurrency chart point 3.

The Fibonacci extension cryptocurrency example illustrated below shows the 3 Bitcoin Chart Points where the Fib extension bitcoin technical indicator is drawn, labeled as Bitcoin Point 1, 2 & 3. Bitcoin Crypto Currency Point 1 is where bitcoin crypto currency trend started, Bitcoin Crypto Currency Point 2 is where bitcoin crypto currency trend pulled back & retraced & Bitcoin Point 3 is where bitcoin price retracement reached as illustrated on the Fib Expansion Technical Indicator cryptocurrency example illustrated below.

How Do I Analyze Fib Extensions in Bitcoin Trading? - How to Analyze Fib Extension Levels in Bitcoin Trading

Fibo Extension Strategy using Fibo Expansion Levels

Please note where these Fibo Extension levels are drawn - Fibo Extension levels are drawn above the Fibo Technical Indicator, these are areas where trader will set the bitcoin take-profits using these Fibo Expansion Levels - 61.80% & 100% Fib Expansion Areas.

Drawing Fibo Extension Levels on an Upward Bitcoin Crypto Currency Trend

We use Fibonacci expansion levels to estimate where the btcusd crypto trend movement will get to. There are Two crucial Fib extension levels: 61.8 % & 100% Fibo Extension Areas, these are used for taking profit.

On the Fibonacci extension cryptocurrency example illustrated below you can see that the Fibonacci extension bitcoin technical indicator is plotted along the direction of the btcusd crypto trend, since the bitcoin trend is upward - the Fibonacci extension cryptocurrency indicator is also drawn upwards.

These Fibonacci extension levels are illustrated as horizontal lines above the Fibo Extension technical indicator, showing the taking profit zones. In the cryptocurrency example illustrated below if you had used of 100% Fibonacci extension you would have made nice profit from the bitcoin trade setup.

How to Interpret Fibonacci Extension in Bitcoin - How Do You Analyze Fib Extensions in Bitcoin Trading?

Drawing Fibo Extension Levels on an Upwards Bitcoin Trend - Fibonacci Extension Strategies in Bitcoin Trading

From the above Fibonacci extension bitcoin examples, the upward bitcoin trend continued & both 61.80% & 100.0% Fibonacci extension levels were all hit after which bitcoin price retraced again after hitting the 100.0 % Fibonacci Extension level.

Drawing Fib Expansion Areas on a Downwards Bitcoin Trend

Since we use this Fibonacci extension bitcoin indicator tool to estimate bitcoin take profit levels, how do we draw it in a downward bitcoin trend?

We draw the Fibonacci extension bitcoin indicator from cryptocurrency chart point 1 to 2 to 3 as shown below. Remember we always draw this Fibonacci extension tool in direction of the cryptocurrency trend. In the Fibonacci extension cryptocurrency example illustrated below, can you figure what direction we've drawn it? That is right - downwards direction on the bitcoin chart.

Try and spot the difference between how we have drawn the Fibo extension above and how Fibonacci Extension is drawn below. This time you would also have used Fib extension area 100 percent, just where the btcusd crypto price reached as illustrated on the cryptocurrency example shown below. That would have been a nice btcusd crypto take profit order level.

Bitcoin Trade Fib Extensions in Bitcoin - How to Interpret Fibonacci Extension in Bitcoin Trading

Drawing Fibo Extension Areas on a Downwards Bitcoin Trend

From the Fibonacci extension cryptocurrency example above, after plotting this Fibonacci extension tool there are 2 levels that are used to show the bitcoin profit booking zones, these 2 Fibonacci extensions are drawn as horizontal lines across the bitcoin price chart.

How Do I Read Fib Extensions in Bitcoin Trading

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