Forex Education

Trading industry knowledge. Learn forex trading, investing in stocks, commodities.

  • Home
  • Choose a broker
  • Brokers Rating
  • Learn trading
  • Affiliate
  • Contact
  • About us
Home » Technical analysis » Chart Pattern » Fibonacci Retracement Levels 88.6%

Fibonacci Retracement Levels 88.6%

by Fxigor

In theory, fib. Extreme retracement after 88.6 is not an important level. However, based on several case studies, the price oscillates around 88.6 to 100% Fib. Retracement very often before rejection or breakout moment.

88.6 Fib. the level represents the price level derived from the golden ratio (0.618 x 0.618=0.786, 0.786 x 0.786 = 0.886= 88.6%).  Fibonacci Retracement Levels 88.6% and 78.6% can be important levels in some cases, so traders need to monitor these levels and check there are price reactions in this area. The best practice is to draw Fib. Retracements levels and Fibonacci expansion levels and analyze all price levels during the trading.

88.6% price level is derived by squaring (or multiplying by itself) from the Golden Ratio, 0.618:

0.618 x 0.618 = 0.786 (78.6%)
0.786 x 0.786 = 0.886 (88.6%)
0.886 x 0.886 = 0.941 (94.1%)

Learn more, in detail articles Fibonacci expansion levels.

Tips for Using the Minimum 88.6% Retracement with Fibonacci Pattern in Forex Trading

When you seek the Fibonacci trading, there are 3 main patterns:
1. The usage of multiple setbacks and extensions for identifying price levels in different Fibonacci levels that overlap for producing “clusters.”
2. The use of multiple indicators like MACD in different Fibonacci levels.
3. The use of Fibonacci levels as a part in a larger graphic pattern, like in the “head and shoulders” pattern.
Fibonacci

Here, you would find information on a specific Fibonacci level focusing on trade and mostly in seclusion. It is a decline of 88.6%. This level was reached for summarization after using 0.618, the Golden Ratio, the square root, and the square to achieve 0886.

When it is exclaimed that it is achieved by making Fibonacci retracement, it means the retracement to 88.6% tells the range of the original characters. Therefore, if the starting step involved 100 pips up, retracing to 88.6, the grains will decline. The unique thing about Fibonacci levels is that they are not influenced by a specific time. They feature the same importance as wanted in a weekly long-term chart, or else they have a graphic instant five minutes.

The first price achieved high Point X 1.1967 on 8th March 2009. Then, it came down to .9909 on the Y-Point on 22nd November 2009. Therefore, the price came down to 2058 points in 37 weeks. The Z price point comes to 1.1730 on 30th May 2010, 28 weeks post Y point. When the figures and diagrams are examined, they were at 2 points, with the retracement level being 88.6%. This is unbelievable, as the price was up thousands of points for many weeks already, which is the precise matching with the main Fibonacci levels.

When this level is identified, you will find a spotless hit giving a trader over 1000 pips when the trader chooses to stay put once the price retracement ends Point-Z. This was accompanied by the long-term decline in USD / CHF, which can be experienced even today. Else, finding that an important Fibonacci level was clean and tested with success, an operator can make several trades in a short-span chart, even in 1 hour, seeking items for selling USD/CHF. Use a long-term plan while entering shorter-term time frames, keeping higher risk-reward ratios, and tight stop-loss in your trade.

One of the possible targets in your trades can be either the beginning of the retracement, expanding 100% of the starting movement, or Point Y, with the starting point being a little out of Point Y.

  • Author
  • Recent Posts
Fxigor
Fxigor
Trader since 2007. Currently work for several prop trading companies.
Fxigor
Latest posts by Fxigor (see all)
  • MACD vs. RSI – Which Indicator Gives Better Trading Results?
  • Do ETFs Have Compound Interest? How Does ETF Compounding Work?
  • Does Index Fund Compound?

Related posts:

  1. Fibonacci Expansion Levels – Download Fibonacci Indicator MT4
  2. Fibonacci Numbers and the Golden Ratio – Trading Golden Ratio
  3. What Are Support and Resistance Levels in Forex?
  4. Psychological Levels in Forex
  5. Bullish Inverted Hammer Candlestick Pattern
  6. Flag Pattern Trading – Bearish and Bullish Flag Chart Pattern
  7. What is Pin Bar in Forex Trading? – Pin Bar Candlestick
  8. Forex Market Geometry
  9. Forex Deviation Levels – Forex Deviation Meaning
  10. How to Use Level 2 Market Data? – Market Data Levels
  11. What Does Take Profit Mean in Forex?

Filed Under: Chart Pattern, Education

Website categories

Main Forex Info

  • Forex Calendar 2022
  • Forex Holidays Calendar 2021 – Holidays Around the World
  • Non-Farm Payroll Dates 2022.
  • Key Economic Indicators For a Country
  • The Best Forex Brokers Ratings List
  • Top Forex brokers by Alexa Traffic Rank
  • Free Forex Account Without Deposit in 2022.
  • Brokers That Accept PayPal Deposits
  • What is PAMM in Forex? Are PAMM Accounts Safe?
  • Stock Exchange Trading Hours

Main navigation:

  • Home
  • About us
  • Forex brokers reviews
  • Investment
  • Education
  • Privacy Policy
  • Risk Disclaimer
  • Contact us

Forex social network

  • RSS
  • Twitter
  • FxIgor Youtube Channel
  • Sign Up. Get newsletter.

Spanish language – Hindi Language

Spanish language website Hindi language website
Risk Warning: Trading leveraged products such as Forex and CFDs may not be suitable for all investors as they carry a high degree of risk to your capital. Trading such products is risky and you may lose all of your invested capital. Before deciding to trade, please ensure that you understand the risks involved, taking into account your investment objectives and level of experience.

Copyright Forex.in.rs 2007

Privacy Policy