{"id":108628,"date":"2017-07-12T07:49:39","date_gmt":"2017-07-12T11:49:39","guid":{"rendered":"http:\/\/countingpips.com\/?p=108628"},"modified":"2017-07-07T07:50:20","modified_gmt":"2017-07-07T11:50:20","slug":"how-to-pick-targets-using-1-2-3-patterns","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/forex\/2017\/07\/how-to-pick-targets-using-1-2-3-patterns\/","title":{"rendered":"How to Pick Targets Using 1-2-3 Patterns"},"content":{"rendered":"<div id=\"inves-2810339238\" class=\"inves-below-title-posts inves-entity-placement\"><div id =\"posts_date_custom\"><div align=\"left\">July 12, 2017<\/div><hr style=\"border: none; border-bottom: 3px solid black;\">\r\n<\/div><\/div><p><b>By Admiral Markets<\/b><\/p>\n<p><img decoding=\"async\" src=\"https:\/\/fxmedia.s3.amazonaws.com\/articles\/HERO-8.jpg\" \/><\/p>\n<p>Dear traders,<\/p>\n<p>In our previous blog post, I showed you how to use <a href=\"https:\/\/admiralmarkets.com\/analytics\/traders-blog\/price-action-tricks-how-to-trade-1-2-3-patterns\" target=\"_blank\" rel=\"noopener\">the 1-2-3 Forex pattern<\/a>. Today, I will demonstrate how to estimate targets using Fibonacci Expansion that comes with our <a href=\"https:\/\/admiralmarkets.com\/trading-platforms\/metatrader4-se\/\" target=\"_blank\" rel=\"noopener\">MetaTrader 4 Supreme Edition<\/a> trading package.<\/p>\n<h2>Fibonacci Expansion<\/h2>\n<p>Fibonacci Expansion is a default tool available in MetaTrader, which is also crucial for price action target. This article will introduce the essential Fibonacci Expansion levels that you might want to use with 1-2-3 pattern trading strategies. To be able to use the Fibonacci Expansion tool properly, I recommend you to watch the video below.<\/p>\n<p><iframe loading=\"lazy\" src=\"https:\/\/www.youtube.com\/embed\/XrjxB8V_R1I?ecver=1\" width=\"640\" height=\"360\" frameborder=\"0\" allowfullscreen=\"allowfullscreen\"><\/iframe><\/p>\n<h2>Fibonacci Expansion Custom Levels<\/h2>\n<p>In order to add custom levels to the Fibonacci Expansion tool, you first need to select the tool from the drop-down menu in MetaTrader 4. This is how you do it:<\/p>\n<p><img decoding=\"async\" src=\"https:\/\/lh3.googleusercontent.com\/2QMSdgFHCR8x-LUgEp4M2yXFaMBFK-qVnAM9QJGZOtGO8CKBQrYFg0HuaM7qIkobJFWTKto3mJQqC8BQOAaJ7Q9dav4sr3Q1q8myKqh5epFquJnlOWye5dHe0c1oEDCqdeJ6PIE_\" \/><\/p>\n<p><em>Source: AM MT4,GBP\/USD H1 Chart, July 5, 2:20 Platform Time<\/em><\/p><div id=\"inves-2054276212\" class=\"inves-in-content inves-entity-placement\"><hr style=\"border: 1px solid #ddd;\">\r\n<div id=\"inpost_ads_header\">\r\n<p style=\"font-size:10px; float:left; color:#666;\">Free Reports:<\/p><\/div>\r\n<div id=\"inpost_ads\"> \r\n<p style=\"font-size:15px; float:left;\"><a href=\"https:\/\/goo.gl\/1ApBOV\"><img loading=\"lazy\" decoding=\"async\" src=\"https:\/\/investmacro.com\/wp-content\/uploads\/2018\/06\/graph_techs_PD.png\" align=\"left\" width=\"80\"  height=\"55\"\/><\/a>\r\n\t     <a href=\"https:\/\/goo.gl\/1ApBOV\"><b><u>Get Our Free Metatrader 4 Indicators<\/u><\/b><\/a> - Put Our Free MetaTrader 4 Custom Indicators on your charts when you join our Weekly Newsletter<\/p><br><br>\r\n<br>\r\n<br>\r\n<p style=\"font-size:15px; float:left;\"><a href=\"https:\/\/goo.gl\/f3RrHX\"><img loading=\"lazy\" decoding=\"async\" src=\"https:\/\/investmacro.com\/wp-content\/uploads\/2019\/01\/cot_pie_80.png\" align=\"left\" width=\"80\"  height=\"55\"\/><\/a>\r\n\t    <a href=\"https:\/\/goo.gl\/f3RrHX\"><b><u>Get our Weekly Commitment of Traders Reports<\/u><\/b><\/a> - See where the biggest traders (Hedge Funds and Commercial Hedgers) are positioned in the futures markets on a weekly basis.<\/p><br><br>\r\n<\/div>\r\n<hr style=\"border: 1px solid #ddd;\">\r\n<br><\/div>\n<p>Once you have selected the tool in <em>Properties<\/em>, add the following levels:<\/p>\n<ol>\n<li>FE 61.8<\/li>\n<li>FE 100.0<\/li>\n<li>FE 138.2<\/li>\n<li>FE 150<\/li>\n<li>FE 161.8<\/li>\n<li>FE 200<\/li>\n<\/ol>\n<p>Please enter some of these levels manually within the indicator properties.<\/p>\n<p><img decoding=\"async\" src=\"https:\/\/lh3.googleusercontent.com\/2DC_kMZ8V-jePvhkpTcPhMcd7252t89RoarrgIvv85im497AyJivJN9X5ke7u11khegz-n70fWnMrmHPTCXXb1Eid8LoUqUKtRYSl3HZqXufE1blIpgdfAWtKjng3ZAGSeDHLI-q\" \/><\/p>\n<p><em>Source: AM MT4,GBP\/USD H1 Chart, July 5, 2:30 Platform Time<\/em><\/p>\n<p>The characteristics of these levels are important for our price analysis and will add up to 1-2-3 pattern trading.<\/p>\n<h3>Fibonacci Expansion 61.8<\/h3>\n<p>This is the first important level of the tool. It doesn&#8217;t usually act as a strong support or resistance when the price approaches it directly, but rather when the 61.8 support or resistance had already been broken (backward approach). It then transforms into a strong S\/R level.<\/p>\n<h3>Fibonacci Expansion 100.0<\/h3>\n<p>This is considered to be a weak support or resistance level. But if the <a href=\"https:\/\/admiralmarkets.com\/analytics\/traders-blog\/price-action-tricks-how-to-trade-1-2-3-patterns\" target=\"_blank\" rel=\"noopener\">1-2-3 pattern<\/a> point 3 equals or is close to 61.8 of 1-2 retracement, FE 100 should be a strong S\/R level.<\/p>\n<h3>Fibonacci Expansion 138.2<\/h3>\n<p>This is a level similar to 61.8 FE, with very similar characteristics.<\/p>\n<h3>Fibonacci Expansion 150<\/h3>\n<p>A very strong S\/R level, usually strong for USD crosses, where the USD is the base currency. (e.g., USD\/CHF, USD\/JPY, USD\/CAD, USD\/SGD, etc.). It is also a strong level for EUR based crosses, where the EUR is the base currency (e.g., EUR\/USD, EUR\/GBP, EUR\/JPY etc.).<\/p>\n<h3>Fibonacci Expansion 161.8<\/h3>\n<p>A very strong S\/R level that possibly marks the end of correction.<\/p>\n<h3>Fibonacci Expansion 200<\/h3>\n<p>Possibly the strongest S\/R level that marks the end of correction, price reversal, and change of the trend.<\/p>\n<h2>How to Place Fibonacci Expansion Targets<\/h2>\n<p>Simply add Fibonacci Expansion to the 1-2-3 pattern that has been formed to estimate possible price projection targets. The only correct way to do it is shown in the following example.<\/p>\n<p><img decoding=\"async\" src=\"https:\/\/lh5.googleusercontent.com\/RFjqhAV4oq7a0H1YnnRX2aHZeJkxuOk6Oslp8TW_4ibw1gSSXKKXR0SHBWbdF3pSrsvgiQMqLBuuxj2RyTpDX5Lcg87Mzk1dbKk4Mo6AM77ZeoM6t6jrk1F8Ue5QqtZ_irBo7UoU\" \/><\/p>\n<p><em>Source: NZD\/JPY Chart, AM MT4, June 20, 15:15 Platform Time<\/em><\/p>\n<ol>\n<li>Identify the 1-2-3 pattern;<\/li>\n<li>Place Fibonacci Expansion;<\/li>\n<li>When the price breaks point 2, take the trade and follow the price to one of the important Fibonacci Expansion S\/R levels.<\/li>\n<\/ol>\n<p><img decoding=\"async\" src=\"https:\/\/lh5.googleusercontent.com\/6WbojHrqWlCHFFrXePHmqk87ZBIcuJ-jIYWJnS0kJDpp1xLl0-CUW4R-OJm0KefAlcRy-YUqflBjRJ7Wdf8dzNCaiuygk_hpOD3AgZ0eWMDFPrYz3ZhN9G2MHRaRumUiyHYMbRsZ\" \/><\/p>\n<p><em>Source: AM MT4,GBP\/JPY H1 Chart, July 5, 2:50 Platform Time<\/em><\/p>\n<h2>Stop-Loss Placement<\/h2>\n<p>Stop-losses are usually placed below point 3 of the 1-2-3 chart pattern for long trades and above point 3 for short trades. However, if a trader wants to be slightly more conservative with a trade, they might opt to place a protective stop above or below point 1 of the pattern.<\/p>\n<h2>Final Words<\/h2>\n<p>As always, the single most important thing out of all the things that matter in trading is proper money management. Try to prioritise your setups and do not use your capital for <a href=\"https:\/\/admiralmarkets.com\/analytics\/traders-blog\/healthy-trading-is-trapping-and-not-chasing-price-2016-03-16\" target=\"_blank\" rel=\"noopener\">chasing pips<\/a> where they simply do not exist. Reserve your capital for proper trade setups with the 1-2-3 reversal pattern using low risk and proper targets. 1:2 Risk:Reward is a good choice, but protect your trade with a profit stop if you are an intraday trader.<\/p>\n<p>If you need any question answered, please ask in the comment section below.<\/p>\n<p>Cheers and safe trading,<\/p>\n<p>Nenad<\/p>\n<p><a href=\"https:\/\/admiralmarkets.com\/trading-platforms\/metatrader4-se\/\" target=\"_blank\" rel=\"noopener\"><img decoding=\"async\" src=\"https:\/\/fxmedia.s3.amazonaws.com\/cta\/images\/58341aa46e42e1479809700.png\" alt=\"MT4 Supreme Edition + Volatility Protection\" \/><\/a><\/p>\n<p><b>Article by Admiral Markets<\/b><\/p>\n<p>Source: <a href=\"https:\/\/admiralmarkets.com\/analytics\/traders-blog\/how-to-pick-targets-using-1-2-3-patterns\" target=\"_blank\" rel=\"noopener\">How to Pick Targets Using 1-2-3 Patterns<\/a><\/p>\n<hr style=\"border: 1px dotted #eee;\" \/>\n<p><a href=\"http:\/\/www.admiralmarkets.com\/\" target=\"_blank\" rel=\"noopener\"><img loading=\"lazy\" decoding=\"async\" src=\"http:\/\/countingpips.com\/articles-analysis\/wp-content\/uploads\/2016\/03\/AdmiralMarkets-sig-1.png\" width=\"141\" height=\"87\" align=\"left\" \/><\/a><\/p>\n<p style=\"text-align: justify;\">Admiral Markets is a leading online provider, offering trading with Forex and CFDs on stocks, indices, precious metals and energy.<\/p>\n<p>&nbsp;<\/p>\n","protected":false},"excerpt":{"rendered":"<p>By Admiral Markets Dear traders, In our previous blog post, I showed you how to use the 1-2-3 Forex pattern. Today, I will demonstrate how to estimate targets using Fibonacci Expansion that comes with our MetaTrader 4 Supreme Edition trading package. Fibonacci Expansion Fibonacci Expansion is a default tool available in MetaTrader, which is also [&hellip;]<\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[],"class_list":["post-108628","post","type-post","status-publish","format-standard","hentry","no-post-thumbnail"],"_links":{"self":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/108628","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/comments?post=108628"}],"version-history":[{"count":2,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/108628\/revisions"}],"predecessor-version":[{"id":108641,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/108628\/revisions\/108641"}],"wp:attachment":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/media?parent=108628"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/categories?post=108628"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/tags?post=108628"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}