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Applying MagicFibo Strategy

The MagicFibo strategy is based on the “MagicFibo Impulse Wave below.

FibTool3

FibTool3 is an excellent Fibonacci indicator freely available for download on the ForexFactory website.

We have prepared an indicator “set” for club members with all the relevant levels preset and keyboard shortcuts. Just email us to receive this.

"R" Levels Setup (Fibonacci Tool)

Open You Fibonacci Retracement tool and set the following settings:

Level Description
1 %$ – SWING H/L
0.854 %$ – MANUAL-STOP/R
0.618 %$ – ENTRY
0.382 %$ – 1R
0.146 %$ – 2R
-0.09 %$ – 3R
-0.326 %$ – 4R
-0.562 %$ – 5R
-0.798 %$ – 6R
-1.034 %$ – 7R
-1.27 %$ – 8R
-1.506 %$ – 9R
-1.742 %$ – 10R
-1.978 %$ – 11R
-2.204 %$ – 12R

Note: If your are going to use the SWING H/L for your R value then the R steps would be 0.382. So R1=0.236; R2=-0.146(-ve) and so on.

MagicFibo Using Risk Reward Indicator

An example on a chart using the TMS Risk Reward Indicator would look like this.

H/L (Swing high/low)
When the H/L is input into the Risk-Reward Indicator it will calculate all the other levels.

MS/R (Manual Stop)
This is the 85.4% Impulse Wave level. This also is your Risk (R) to calculate your position sizing and targets.

PC (Previous day close/entry-level)
This is the Close price of the previous day’s trading at the New York session close. This is also referred to as our “Signal Bar”. The Risk-Reward Indicator automatically knows this price level.

T1 (Target 1)
The Risk-Reward Indicator default is R1.5

T2 (Target 2)
The Risk-Reward Indicator default is R2.5

FO (100% level on Fibo Tool)
This level can be added to your Fibonacci tool to manually set the Target levels.

The TMS Risk reward properties

MS Multiplier: This is the Manuel Stop and R-value set at 85.4% on the Inpulse Wave (0.146+0.854)=100%.

T1 Multiplier: The default setting is 1.5R which is 26.7% on the Inpulse Wave. To change this to 1R the level on the Inpulse Wave would be 38.2% and setting (1.0-0.382)= 0.618.

T2 Multiplier: The default setting is 2.5R which is 2.8% on the Inpulse Wave. To change this to 2R the level on the Inpulse Wave would be 14.6% and setting (1.0-0.146)= 0.854.

DISCLAIMER: Trading futures, options on futures and off-exchange Foreign Exchange market (FX, Forex) is very speculative in nature, involves considerable risk and is not suitable for all investors. Before participating in trading, you should carefully consider your investment objectives, level of experience and risk appetite. Investors should only use risk capital when trading because there is always the risk of substantial loss. Most importantly, do not invest money you cannot afford to lose. Any mention of past performance is not indicative of future results. Account access, trade executions and system response may be adversely affected by market conditions, quote delays, system performance and other factors. Past results as represented in testimonials are not necessarily indicative of future results or success. Testimonials may not be representative of all reasonably comparable students. Trading involves significant risk of loss and may not be suitable for all investors. RISK WARNING: Trading futures and foreign exchange on margin carries a high level of risk, and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to trade foreign exchange you should carefully consider your monetary objectives, level of experience, and risk appetite. The possibility exists that you could sustain a loss of some or all of your deposited funds and therefore you should not speculate with capital that you cannot afford to lose. You should be aware of all the risks associated with foreign exchange trading, and seek advice from an independent advisor if you have any doubts. Past returns are not indicative of future results. HYPOTHETICAL PERFORMANCE RESULTS HAVE MANY INHERENT LIMITATIONS, SOME OF WHICH ARE DESCRIBED BELOW. NO REPRESENTATION IS BEING MADE THAT ANY ACCOUNT WILL OR IS LIKELY TO ACHIEVE PROFITS OR LOSSES SIMILAR TO THOSE SHOWN. IN FACT, THERE ARE FREQUENTLY SHARP DIFFERENCES BETWEEN HYPOTHETICAL PERFORMANCE RESULTS AND THE ACTUAL RESULTS SUBSEQUENTLY ACHIEVED BY ANY PARTICULAR TRADING PROGRAM. ONE OF THE LIMITATIONS OF HYPOTHETICAL PERFORMANCE RESULTS IS THAT THEY ARE GENERALLY PREPARED WITH THE BENEFIT OF HINDSIGHT. IN ADDITION, HYPOTHETICAL TRADING DOES NOT INVOLVE FINANCIAL RISK, AND NO HYPOTHETICAL TRADING RECORD CAN COMPLETELY ACCOUNT FOR THE IMPACT OF FINANCIAL RISK IN ACTUAL TRADING. FOR EXAMPLE, THE ABILITY TO WITHSTAND LOSSES OR TO ADHERE TO A PARTICULAR TRADING PROGRAM IN SPITE OF TRADING LOSSES ARE MATERIAL POINTS WHICH CAN ALSO ADVERSELY AFFECT ACTUAL TRADING RESULTS. THERE ARE NUMEROUS OTHER FACTORS RELATED TO THE MARKETS IN GENERAL OR TO THE IMPLEMENTATION OF ANY SPECIFIC TRADING PROGRAM WHICH CANNOT BE FULLY ACCOUNTED FOR IN THE PREPARATION OF HYPOTHETICAL PERFORMANCE RESULTS AND ALL OF WHICH CAN ADVERSELY AFFECT ACTUAL TRADING RESULTS. Privacy Policy