Fractal Analysis


Forex Technical Analysis & Forecast 18.09.2020
Forex Technical Analysis & Forecast 18.09.2020
EURUSD, “Euro vs US Dollar”After updating its previous low and testing the long-term support level, EURUSD has formed the ascending structure towards the mid-term resista...
Forex Technical Analysis & Forecast 16.09.2020
Forex Technical Analysis & Forecast 16.09.2020
EURUSD, “Euro vs US Dollar”After updating its local highs and then correcting to break the support area at 1.1852, EURUSD has formed another support line at 1.1832; right...
Forex Technical Analysis & Forecast 15.09.2020
Forex Technical Analysis & Forecast 15.09.2020
EURUSD, “Euro vs US Dollar”EURUSD is no longer consolidating within a Triangle pattern; after reaching 1.1890, it has broken this level to the upside. At the moment, the ...
Forex Technical Analysis & Forecast 14.09.2020
Forex Technical Analysis & Forecast 14.09.2020
EURUSD, “Euro vs US Dollar”EURUSD is consolidating within a Triangle pattern. After testing the pattern’s downside border, the pair may grow to test the key resista...
Forex Technical Analysis & Forecast 11.09.2020
Forex Technical Analysis & Forecast 11.09.2020
EURUSD, “Euro vs US Dollar”The currency pair is developing a downtrend, correcting the preceding medium-term uptrend. Yesterday the market demonstrated an inner pullback ...
Forex Technical Analysis & Forecast 10.09.2020
Forex Technical Analysis & Forecast 10.09.2020
EURUSD, “Euro vs US Dollar”The currency pair performed a decline to 1.1753 and is now correcting. Today, it might reach 1.1820, then decline to 1.1790. At these levels, a...
Forex Technical Analysis & Forecast 09.09.2020
Forex Technical Analysis & Forecast 09.09.2020
EURUSD, “Euro vs US Dollar”The currency pair keeps developing a downtrend. Today, it may test 1.1787 from below, then decline to 1.1745. Next, the pair may grow to 1.1787...
Forex Technical Analysis & Forecast 03.09.2020
Forex Technical Analysis & Forecast 03.09.2020
EURUSD, “Euro vs US Dollar”The currency pair keeps developing a wave of decline to 1.1800. After this level is reached, we expect growth to 1.1850. On these levels, a con...
Forex Technical Analysis & Forecast 02.09.2020
Forex Technical Analysis & Forecast 02.09.2020
EURUSD, “Euro vs US Dollar”The currency pair demonstrated growth to 1.2000 and started developing an impulse of decline. At the moment, the market has worked off the matr...
Forex Technical Analysis & Forecast 01.09.2020
Forex Technical Analysis & Forecast 01.09.2020
EURUSD, “Euro vs US Dollar”The currency pair has completed the structure of growth to 1.1999. At the moment, the market is trading in a narrow consolidation range at the ...

Advantages of Fractal Analysis 

Fractal forex analysis is proved to be quite helpful in terms of foretelling the growth and the downfall of the price rates. Once you understand how it works, it will no longer cause difficulties – on the contrary, it will make your work easier and more effective. The correct use of the fractal analysis can make market behavior and the pricing a little more foreseeable.

The Essence of the Fractal Market Analysis

A Fractal is one of five indicators of Bill Williams’ trading system, which allows determining the bottom or the top. Fractal Technical Indicator is a set of at least five sequent bars. According to Williams, an "up fractal" or the “buy fractal” is defined as a middle bar with two lower highs on each side of it. A "down fractal", also known as the “sell fractal”, is a middle bar with two higher lows on each side of it. Fractals are valid up to the point that they are triggered, or there's a new fractal that appears in the same direction (in this case the previous signal has to be ignored and the pending order has to be deleted).

Using the fractal analysis

 As in everything we do, practice is the crucial part of the success. Therefore, it is advisable to learn how to generate small models. The second step would be the careful analysis of the external factors. Try to model a real market situation, predicting the further development. If if works, feel free to apply your skills to real trading.

For the successful fractal technical analysis remember the following:

  • It is wiser not to take trades before the first fractal is triggered
  • If the buy signal is above the Red Balance Line (the Alligator’s Teeth), place a buy stop one tick above the high of the up fractal.
  • If the sell signal is below the Red Balance Line, we would place a sell stop one tick below the low of the fractal sell signal.
  • Protective stops should be placed beneath the lowest low of the most recent Down Fractal

Fractals do not have predicative value for the price as they only follow it. Traders mostly use fractal analysis with other indicators to confirm that reversals have indeed occurred.

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