Welcome! Dear Traders,you are reading my forex trading experiences. Forex trading is a very profitable and very risky business opportunity. If you are a beginner, calm down,have a cup of coffee, and convince yourself that you need to study hard to win in forex trading. Obviously, the task is not easy as the statistics claim that only 5% traders win in forex trading. If you are determined, serious,and hard working, you can surely be included in the group of winners.

### TECHNICAL ANALYSIS WITH FIBONACCI PARALLEL TREND LINES OR CHANNELS

I have long time experience of trading with parallel trend lines or channels, but very recently I got introduced with the fibonacci channels and the trading techniques with the tool. Today I am going to share the trading technique with fibonacci channels. I drawn the fibonacci channels with great fibonacci lines analyzer tool. Let me explain the trading technique with fibonacci channels.

As fibonacci expansion tool, we need three points or two waves to draw the fibonacci channels. The first point is at the beginning of the original wave, the second point is at the end of the original wave, and the third point is at the end of the wave that is retracing the original wave.

But it is better, if the trend lines in the original fibonacci channel lie on more than one tops or bottoms.

In the illustration below, I have drawn fibonacci channels to trade a bearish trend. The role of main channel is similar to the role of traditional channels in trading. So, the traders need to wait for the breakouts of the main channel. The lower trend line of the original channel represents support for a bearish trend ,and the upper trend line of the original channel represent resistance for a bullish trend.

In the following illustration, fibonacci channels are drawn to measure a bullish trend.

Fibonacci channels can be traded in different ways.

Firstly, a long or short order can be placed when the breakout of the original channel appears. The take profit for the orders can be placed at the trend lines beyond the original channel. Here original channel is red in color.

Secondly, the trend lines beyond the original channel can be traded as they represent strong support and resistance levels. In the above illustration, we can see that the trend lines represent strong support and resistance areas.

To draw effective fibonacci channels, we need to remember that every trend lines in the original channel should be put on more than one tops or bottoms.The trend lines on single top or bottom cannot be considered as an effective trend line to compose an effective channel.

Fibonacci channels can be a replacement of traditional channels. It is more effective than the traditional parallel trend lines because it also helps the traders in placing profit target.

1. Hi, Do you know how to use time zone fibonacci?
Your blog has an excellent content.

2. Drawing trend lines is one of the few easy techniques that really WORK. Prices respect a trend line, or break through it resulting in a massive move. Drawing good trend lines is the MOST REWARDING skill.

The problem is, as you may have already experienced, too many false breakouts. You see trend lines everywhere, however not all trend lines should be considered. You have to distinguish between STRONG and WEAK trend lines.

One good guideline is that a strong trend line should have AT LEAST THREE touching points. Trend lines with more than four touching points are MONSTER trend lines and you should be always prepared for the massive breakout!

This sophisticated software automatically draws only the strongest trend lines and recognizes the most reliable chart patterns formed by trend lines...

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Chart patterns such as "Triangles, Flags and Wedges" are price formations that will provide you with consistent profits.

Before the age of computing power, the professionals used to analyze every single chart to search for chart patterns. This kind of analysis was very time consuming, but it was worth it. Now it's time to use powerful dedicated computers that will do the job for you:

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