There are many ways to trade FX and using the Fibonacci ratio is a commonly used method which many traders find effective.
However, it can be quite inconvenient to draw the Fibonacci ratio on the chart every time. This “ZigZag_Fibo” indicator for Metatrader 4 automatically draws the Fibonacci ratio on the chart.
The indicator displayed on the EuroDollar hourly chart
This "ZigZag_Fibo" automatically draws the Fibonacci levels by using the peaks and troughs drawn by the zigzag indicator. This makes it very simple and easy to trade with the Fibonacci ratios as nearly all work is automatized.
So, you can use this indicator to trade the Fibonacci levels just as you would normally. You can read these articles to learn more about the Fibonacci retracements and extensions:
- How Fibonacci Retracements are Used in Forex Trading >>
Look at the image below. It can be observed that the retracement that occurred in the area enclosed by the square stopped at the 61.8% Fibonacci retracement level of the bullish swing.
This is just an example. In fact, if you look at the various timeframe and currency pairs we discover that the relationship between Fibonacci ratios and swing highs/lows is very consistent. Of course, depending on the currency pair, the Fibonacci ratios may work better on some of them than on others. So, definitely try to examine and discover these relationships.
This indicator will be especially useful for those of you who are using the Fibonacci levels often.
- ExtDepth - The depth of zigzag
- ExtDeviation - The deviation of zigzag
- ExtBackstep - The backstep of zigzag
Download the MT4 "ZigZag_Fibo" indicator from the button below
Tip: Can’t open the downloaded archive file (ZIP or RAR)?
Do you need help with installing this indicator into MT4 for Windows or Mac OS? Our guide HERE will help you.