The Profit Ruler: How to Use Fibonacci Correctly (Premium vs Discount)

[00:03] to open your manual. I am Lois. And I am Ricardo. Lis, I'm tired. Everyone says Fibonacci is a divine sequence, but my chart looks like a rainbow because of all the lines it creates. Sometimes I buy at 38 and

[00:16] then it sells at 50, and then there's the 61. It feels like the market is playing understand. Your mistake, and the mistake of many traders, is thinking that Fibonacci is a magical support system. The Fibonacci sequence is not a

[00:29] static wall, it's a ruler. It serves to tell you only one thing. If you don't know which zone you're operating in, well, you 're just guessing. Okay, so today we're going to simplify everything. First, we're going to

[00:42] explain the theoretical part, how Fibonacci works, how to use it, and then we'll go straight to the practical part, as we always do. And since you should do the same, I think it will help our channel a lot.

[00:55] Subscribe to our channel here, like our video, and leave any questions you may have in the comments, both here and on our Instagram. You can follow us Instagram. You can follow us there. So, let's go to the video.

[01:12] members' area. Members, each level has its own advantage. See if you like any of the genres, check out preview videos. Some videos will also only be available to members. So, take a look there, see if you find it interesting, if it's good for

[01:26] channel grow even more, and we'll be able to reach and help even more people. So let's go, little Padawan. If you open the Fibonacci tool today, you'll see several broken levels there

[01:39] . To understand the market context, you'll basically market context, you'll basically need three levels: 0%, 50%, and 100%. But is that all? And what about that

[01:51] Calm down, calm down, calm down. The other levels serve as a confluence, but the secret lies precisely in the balance. The 50 level is our equator line, it's the fair price. Above that point the price is expensive, below that point the price is cheap.

[02:06] we'll reverse it. Imagine you sell iPhones, do you want to cheapest stock? Of course it's cheaper, right? That way, . And it's the same thing in the financial market.

[02:21] If the trend is upward, the market experiences a surge, it rises sharply. When it starts to correct, you'll want to buy, but the big banks will only buy when it goes back below 50%. If

[02:34] you're buying more than 50% off, you're paying too much. And those who pay a high price are usually stopped out by the lack of liquidity. And to help you understand more about a liquidity zone and the importance of knowing about it,

[02:47] we have a really good video about it here. And Fibonacci alone doesn't work miracles. Ideally, when working with Fibonacci, you should work with those zones, you know, with support and resistance. And with that, he will further validate the

[03:00] strength of the support or resistance. So now let's get practical and find out how to use Fibonacci. In the corner here on the right, we have the Fibonacci price. We click on it here, we choose

[03:14] a base, right, and the top, right, of a movement, isn't it? It can be a larger movement, a much larger movement, but in this case we're at 5 minutes and we're going to use movements that are smaller than those in 5-

[03:27] minute intervals. Usually, movements like that are big and long, right? This type of movement is more interesting to him. Now, why didn't I use this other movement here in reverse, thinking about a sell signal, because in this position,

[03:41] looking more towards the bottom, it doesn't indicate a powerful sell signal or anything like that ? So, we're not going to pursue that type of sale. Secondly, remember what

[03:53] we said, we need to find some kind of support or resistance. In this case , we saw that it's a very strong support, because he's already been testing strong support, because he's already been testing it here. So, we'll think about

[04:07] buying it, right? That's why I thought that. If we look back a little at the chart, and look at it as if the day were still unfolding, the day were still unfolding, this would be our

[04:22] buying expectation, a bullish, reversing trend, because of this. So, we've drawn the Fibonacci sequence here. I'm going to double-click here on Fibonacci just to show you how we've set up

[04:38] So, there's not much you can do with this setup; it's just like that. those other two numbers we talked about as just 0, 50, and 100%? These other

[04:50] two levels here will help to tell if it's really cheap or little extra confirmation that we need. We set these less frequently used levels to a thickness of one, and the main levels,

[05:05] 0, 50, and 100, we set to a thickness of three with a fill to make it look nicer, right? We've included this here to show you the levels so you is the zero because it was the beginning of the movement. 38.2, 50, 61.8,

[05:22] and 100%. OK? So this is how we set up our Fibonacci sequence to help us with the operation. So what happened? There was a very rapid, very strong upward movement here, and we're not going to participate in

[05:37] that movement at any point. What are we waiting for? He'll go back below 50%, which is our discount region, where it's cheap, where everyone wants to buy, so he can then sell it for more. So we

[05:52] expect the price to break through that 50% region. Ideally, you should buy at least close to 38.2%. Exactly at 38.2. We expect it to break below the

[06:05] 50% Fibonacci retracement level here, and we'll place a buy order when it hits 38.2 because we want to buy cheap. If you want, place a second order below, roughly 50% of this

[06:21] movement, to buy even cheaper in case the price has fallen further. So it's interesting, for example, to buy one contract here, and then buy the second contract here. Our stop is, of course, right below, right? And with our gain,

[06:37] we can put a two-for- one ratio. So let's go. Here at 38, our stop loss is down here and our take profit is up here. What you can also do with your game is that you don't even need to use two for one or any other game. Your

[06:53] two for one or any other game. Your gain can be exactly your 100% Fibonacci retracement, or as many people use the term, once the movement ends here, we can the movement ends here, we can draw 100% of the projection, OK? But

[07:07] this starts to get dangerous and it might not work, right? Many people here use 161.8%, 8% might not be very effective for holding on the same day, especially when it's a movement with many

[07:21] points, it can be a bit risky to wait until 161, OK? This is the ideal here at 100%, whether it's the projection or the Fibonacci sequence itself. Okay, everyone, just a minute. Many people come to us and ask if we

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[09:44] explain, easy to understand here. If you want to consider a decline, just explaining it like that, without any analysis, right? Just thinking about it, look, it got close to 50% here, so if he were indicating it, it would be

[10:00] close to 38.2, OK? This would be our selling point, with our profit would be our selling point, with our profit at 100% and our stop loss at 0%. That's it . Trading isn't about guessing where the price will go, it's about knowing

[10:15] if you're entering a profitable zone. Fibonacci is your GPS, helping you not get lost on your way to finding the profitable zone. That's right finding the profitable zone. That's right . And the GPS is that 50%. Anything

[10:27] above 50% is expensive, anything below 50% is cheap. Just by doing that, you'll already find better places to shop, right? Remember that it needs to be consistent with other indicators or regions that you have already studied.

[10:42] regions that you have already studied. If this video simplified your life, give it a like and comment below if you already use Fibonacci as a GPS to use Fibonacci as a GPS to find the best zones.

[10:54] Comment below if you've ever used Fibonacci as a GPS, and also subscribe to our channel and don't forget to check out this video here. check out this video here. Until next time.