How to Draw Fibonacci Lines

Fibonacci Retracements:

How to Draw Them Drawing Fibonacci lines is easy. It can be broken down into three easy steps:

• Identify the bottom and top of the overall trend. The bottom is referred to as support, and the top is referred to as resistance. While they are subjective, support and resistance levels can easily be determined simply by looking at a chart.

• Using a charting package you are comfortable with, draw Fibonacci lines from the support level to the resistance level. The three lines should appear: one at 38.2% of the difference from the top and the bottom; one at 50%; and another at 61.8%. These are the key Fibonacci levels around which you should look for potential opportunities to enter trades.

• After that, simply look for price action to confirm an opportunity to enter a trade.