Best Fibonacci Trading Indicators_

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00:00hello this is Andrew Palladino here and I'm here to go over the golden fib ratio

00:09modified version that was created for trading view this is slightly different from the one

00:19implemented in MT4 the main difference is the ability to take entries in a direction of a

00:28longer time frame trend sorry a longer trend specified on the given time frame in this case

00:37I am using two moving averages to qualify that trend the 13 EMA and a 34 EMA so as long as the 13

00:48and a 34 are stacked in the positive direction and pointing upwards it will only take longs

00:55and vice versa if we have the 13 and a 34 EMA stacked in the negative direction it will only take shorts

01:06okay so that's pretty much one of the biggest differences between this version and the one in

01:14the MT4 also this is a strategy so it will actually give you long and short entries right on the chart

01:23I'm going to go through the inputs here and as I'm going through the inputs I'll explain the strategy

01:31in a little more detail so the most important input is well you have the 13 and the 34 EMA periods okay

01:41so you can change those to anything you want but the most important input is the swing is the minimum

01:47swing percentage so what this does is it limits the swing from which the FIB retracement is based on to be

02:00at the very least a certain percentage okay so in this case it's set to 0.5 for the four hour chart on the

02:09US dollar Canadian pair this is going to change if it's if you're trading the five minute chart this

02:16will not work it will not you will not see any trades on a five minute charts or very few trades

02:22because the the swings on a five minute chart are are much lower okay in percentage wise so that's pretty

02:36much the the parameter that along with the target and the stop loss that is the parameter that needs to

02:43be changed depending on which pair and time frame you're looking at so let me define a swing so did you

02:53have these fractal highs and lows marked by triangles okay and the swing is basically the distance between

03:04the in this case the fractal low okay which is this point all the way to the fractal high which is that

03:15point so that cyan line is displayed as soon as price drops below the sixty one point eight percent retracement

03:26line so that cyan line represents the sixty one point eight percent retracement line so you will see the

03:35the candles colored differently okay in this case because we're long the candles are colored blue and you can

03:43change all this in style show you how what you click on properties go to style and you can change all the

03:55colors you can make them you can change the moving averages you can do anything you want you can disable

04:01some of the moving averages you know you won't see them but the strategy will still be based on those

04:07moving averages so back to the entry here so the candles will start changing blue as soon as they breach this

04:17level and the entry is taken as a buy stop at that level so when the candle travels through that price it will

04:27take a position in this case the stop the the stop is set to 50 pips point zero zero five and the target set to

04:41200 pips so in this case we had we entered along and we took profit up here let's measure this just to make

04:55sure yeah that's 200 pips right there now if we there is another feature that is that can be turned on

05:10and which I like a lot is this activate trailing stop so what that does is it will activate a trailing

05:23stop where you click on that and let's let's say we're going for 500 let's say we're going for 300 pips

05:32okay so I activated that trailing stop and this is what happens okay it still took profit at 300 but look at

05:44our stop see it's ratcheting up okay so the way this works is is as follows as soon as we enter a trade

05:57this initial stop will be kept for 20 bars after the 20th bar the initial stop is overridden by the

06:07lowest low of the last 20 bars so in this case we zoom we zoom in a little bit here the lowest low

06:17is this candle okay and as we as that value changes the stop changes as well it's just a great way to

06:28capture you know a trend so obviously we we hit the 300 pit mark here so it didn't really make any

06:38difference well let's make that 400 pips see what happens there we go so the target was way too high

06:50and we got stopped out on this candle right here right on the trailing stop so we were able to capture

06:57the majority of the trend using us using a trailing stop which is nice because it usually coincides with

07:05the trend reversal as well when you're when you're trailing a 20 bar high 20 bar low in this case now

07:13everything that we've talked about on the long side applies on the short side as well so let me just

07:20disable this for a second and let me talk about an additional property which is important this enable

07:35trade direction currently it's set to zero meaning it will take both long and short trades if you want

07:43you can take long only trades so it will only take long trades by setting this to one okay and it will

07:54only take short trades by setting this parameter to minus one as you can see our long position disappeared

08:05so i'm going to keep that i'm going to go short only for here and i'm going to show you

08:12the trade in the short direction okay so in this case

08:22we had

08:28a short position initiate here which is the 61 fib retracement level of this swing from high to low

08:38low and we entered the position and we did not get stopped out we hit our target way down here

08:50now let's do this again we come here and we're going to enable the trailing stop so if we enable the

08:57trailing stop in this case okay we would have captured this amount

09:08okay so

09:12here is one more uh property that

09:16isn't really important i mean all these are important but this fib retrace max bars okay so

09:24what the what this does is it this can this uh relates to the retracement okay so

09:32as soon as we get a retracement below that fib level and we're waiting for an entry to trigger

09:42there is a maximum number of bars uh that can take place in that in that retracement so if it goes above

09:5210 bars so if we get a retracement that is longer than 10 bars it will invalidate that trade it will

10:00cancel that buy stop for a long or sell stop for short so that's what that what that that's what this parameter does

10:10um so that's that's pretty much it um let me just go over the strategy tester because

10:19this is kind of a cool little tool that you can use to you know uh tweak your your inputs a little bit so

10:29you get the right number of trades or the total number of trades you're you're interested in capturing

10:37so trade frequency and and obviously you know profitability too and uh i could say that um

10:44i'm optimizing a little bit here but you know it it allows you to pick inputs that are reasonable okay

10:52you're not always gonna uh have a great looking equity curve okay but it allows you to pick reasonable

11:00inputs so let me show you one thing that i do is the first thing i do is i actually uh play around with

11:08the target and stop loss okay so currently it's set at 400 pips let me turn off the trailing stop okay

11:18and let me set this to buy and sell so if we were to drop that to let's say 200 pips

11:26okay the equity curve doesn't look that great all right well 200 pips is probably a low probability

11:35target so let's drop it to 100 pips that looks pretty good so we have a two to one reward to

11:43risk ratio uh the the equity curve looks a lot better here let's drop to 50 pips now so now we have

11:51one to one reward to risk and that looks that looks like a really good equity curve okay so what i'm

11:58doing here is i'm just picking a high probability target and and going with it and if there's if if

12:06if i if i get enough trades and my profit factor looks good you know i that's those are the settings

12:13that i'm going to use and yeah i mean i'm optimizing a little bit but i i you got to do that a little

12:21bit in order to get the right settings in order to get the total number of trades i mean not all pairs

12:30are going to look this clean but um this is something that uh you're going to have to play around with a

12:37little bit until you're comfortable with settings that are reasonable to you so uh this is pretty

12:47much it this is uh this is the trading view golden fib ratio strategy

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