The
Fibo Code Strategy is a price action trend forex trading system.
Fibo
Code is a robust strategy that could be used over diverse currency
pairs. The strategy has proved to be profitable over multiple pairs
however when starting out with this strategy it is recommended that
you limit to 3-4 Currency pairs.
Fibo
Code works over two timeframe, longer term timeframe (4 Hr) is used
to form a daily trading bias. Whereas, shorter term timeframe (15 M)
is used to confirm trading signal.
You
can open two charts for each currency pairs with different timeframe.
Metatrader
4 Indicators
10
Period SMA shift (1)
FiboTrend
(Custom Indicator): Fibo Ratio 1 (8) Fibo Ratio 2 (13) Fibo Ratio 3
(21)-Fast EMA (8), Slow EMA (21), Signal EMA (9)
Fibo
DI (Custom Indicator) (8, 13, 21).
Note:
To draw fibonacci retracements or use the metatreder 4 tool or in
the folder I included two indicators that draw fibonacci
retracements, the MT4 indicators are: Fibonacci and Fibonacci
retracement.
Fibonacci
retracement to mark important levels. The retracement levels need to watch
very carefully. You can scale out (partially close) order when price
hits anyof
these levels.
Fibonacci
retracement will draw yellow horizontal lines at the following
levels: 0.00%,
23.6%, 38.2%, 50%, 51.8%, 61.8%, 100%, 161.8% and so on. The
following image shows the Fibonacci retracement drawn using
short-term uptrend.
The
image below show Fibonacci retracement drew using short-term down
trend. In simple terms it means if the price retrace it is likely to
hit these levels and these levels acts as support and resistance for
the price.
Buy
A
Candle must cross the SMA and close above it.
Fibo
DI should be green for confirmation.
FiboTrend
histogram must start going up.
Stoploss
is below the last swing low.
Buy
Exit Rule
Price
reaches strong resistance level.
OR
Price crosses back below the SMA and FiboDI turned Red or Gray.
Sell
Price
must cross the 10 SMA downwards and the candle must close below it.
FiboDI
should be red for confirmation.
FiboTrend
histogram must be pointing down.
Stop
is above last swing high.
Sell
exit
Price
reaches a strong support level.
OR
Price crosses back above the SMA and FiboDI turned Green Or Gray.
Long
tade example
The
image above shows EURUSD chart with the custom indicators and
Fibonacci.
Retracement
levels drawn from last high to recent low. The Fibonacci.
Retracement
levels are marked by yellow horizontal lines. These are important
levels which should be watched closely and could be used as scale out
levels means you can partially close trade when price crosses these
levels. 
The
image above shows labeled EURUSD chart with trade triggers for buy
entry.
The
price closed above 10 Period SMA at 1.2098, for confirmation we will
check FiboTrend and FiboDI.
FiboTrend
bars are going up whereas, FiboDI is green therefore this gives us
positive confirmation so we will enter at 1.2098.
Fibonacci
exit points are marked 50%, 61.8% and 100%. These levels could be
used as scale out points.
Stoploss
should be set at swing low in this example its 1.2076.The candle
closed below SMA at 1.2121 with stochastic pointing down which marked
the trade exit point.
Short
Trade example
We
will draw Fibonacci Retracement for the last swing high from
isstarting low position. The retracement levels marked by yellow
horizontal lines are important levels. These levels could be used as
scale out levels means you can partially close trade when price
crosses these levels.
The
image above shows labeled diagram with trade triggers for sell trade.
The
price closed below 10 Period SMA, for confirmation we will check
FiboTrend and FiboDI.
FiboTrend
histogram is declining whereas, FiboDI is red therefore this gives us
positive confirmation so we will enter at 1.2310
Fibonacci
exit points are marked 61.8%, 100% and 161.8%. These levels could be
used as scale out points.
Stoploss
should be set at swing high in this example its 1.2331
The
candle closed above SMA at 1.2293 with stochastic pointing upward
which marked the trade exit point.
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