Track 'n Trade - Stocks | Futures | Forex

Using the Fibonacci Ruler

Video Transcript

In this video, we want to cover how to place the Fibonacci Ruler within Track 'n Trade. I also want to make a note, here, that these features are exactly the same, whether we're using Track 'n Trade Stocks, Futures, or Forex. You'll notice that I'm using the Futures version for this demonstration.

In this chart, to select the Fibonacci Ruler, very simply, we click the button for Fibonacci. If we have the Preferences Tab selected, you'll notice that we have all the preferences for the Fibonacci Ruler. It looks a little bit overwhelming, but if you think about it, it's really not, it's very simple. All we're doing is we're talking about the different lines that make up the different sections, of the Fibonacci Ruler.

This first section, of course, is just the ruler section itself. As we draw the ruler, we simply hold down the left mouse button, start at the top of the trend, we begin to draw to the bottom of the trend. You can see that we now have the bottom and the top of the trend identified through the Fibonacci Ruler. Indicating that we are looking at an A, B pattern. This would be the Fibonacci Ruler going through the Price and Time.

You'll notice that on the Fibonacci Ruler, we also have the Time Zones. They are listed, here, as well. You can see them listed by the vertical lines, here. They are outlined with the numbers across the top. This is 0, 1, 2, 3, 5, these are Fibonacci numbers, but they're representing the number of Price Bars, 13, 21, 34, 55, Price Bars out. This is how far out these Price Bars go, and you'll know the further they extend, the further the Fibonacci Time Zones or Time-Lines occur. This is how we draw those, very simply, by right clicking, and you can turn the Time Zones on, turn the Time Zones off.

The next thing I want to talk about, very simply, so we can see this a little bit better, let's slide all the way to the bottom. We're going to increase the Font size, I'm going to bring that up to 10, and I'm going to make it Bold. We have Show Text on, so we can see the text very clearly. Snap, of course, is snapping it so that we can snap it to the exact High and Low of the trend. That would be these points, here that touch the exact trend levels. This is the Snap To and the drawing of the different trends.

What I want to do now, is just simply customize the tool, just a little bit. You can see that these lines, here are selected and turned on Fibonacci. 61.8, 50, and 58.2. Again, this video is not meant to go through and explain all the numbers and what they mean. Those are done in a different videos. This is meant to help you learn how to turn these features On and Off. Simply by selecting these features, you can see that they're turned On and Off, this is how we turn them On and Off. We can turn them back on, turn them back on. We want all of these turned on, just the way we had it.

If we want to have the Fibonacci 78.6% or 76.4% levels turned on, we turn those out here. The reason there are two numbers, 78.6% and 76.4% is because the calculations can be done in two different ways, and get a different result. Whether you get 78.6% or 76.4%. If you want to see those calculations, those are done, here. Either squaring gives you the 78.6% or the division gives you the 76.4%. If you are that concerned about the numbers, whether you like 78.6% or you like 76.4%. You can choose the different math method here, that gives you the different results for those outlying projection levels. We can turn those On and Off in this region, here, as well. We can also change the colors, I like to come in here, sometimes and make these colors a little bit easier to see. We'll come in and we'll make this one Red, maybe we'll make this one Green, we'll make this one Green, so we have the sweet spot outlined in the center. Let's make that one Red and then make this one Green, as well. We have our color line for the center of the sweet spot of the Fibonacci Ruler. We have that ability.

To turn on Retracement Levels- RETRACEMENTS ARE: Markets have a tendency to trace above or below the initial triangle formation or the initial setup of the Fibonacci Ruler. We can either turn those on by clicking the projections, here, which would project out the bottom, because we're going down in this case. We're starting at the top of the trend, projecting A, B and you'll see this would be D down here. A, B, C, D, so we are projecting down. That would be projections.

If we had drawn the trend tool or the Fibonacci Ruler from the bottom, up, like this, then turned on the projections, you would notice that it would project up, as opposed to down. It depends on which way you draw the tool, that gives you the projections going either up or down. You'll notice that A is on the bottom, here, B is on the top. Here we have A on the top, B on the bottom. We would be projecting towards the next level. That's how we get those. Of course, we can do that with the right click Menu, as well. If we right click on the tool, we have the ability of turning off the projections, here, or the predictions. Then having the control, or the retracements having the control over the different lines, if those are turned on. So we have the projections turned on, we can turn on and off each individual line, here, in the right click Menu. That's how I access this Menu, here, just by simply right clicking on the ruler itself. I have access to the different lines, just as I would over in the Preferences Tab. In this case we can come in here, and go ahead and turn on the retracements, which is going to put the retracements to the upper side in case, because the retracements would be above us, since we're looking at the market going short.

If we squeeze down the Fibonacci Ruler, you can see that we have the Fibonacci Ruler drawn through the center point, here, from A to B. Projecting lower, retracing higher. That's how we would draw that in there. That's how you turn those features on, with the Time Zones laid in there. This is how we're going to calculate the trend going out into the future.

We have the ability to come in and customize each section, we can come in and customize the background or the individual lines for the Fibonacci Ruler, itself. We could do the same thing for the retracements. We could come in here, and change the colors, make them a little bit more specific to our goals that we would like to have, or that we would like to see.

These markets could project out to or retrace to. We can come down and we can change these colors, as well.

We also have the ability to change these to different line styles, different colors, line thicknesses, and styles. To draw attention to the specific areas that we're most interested in seeing the markets retrace or project out to.

Most of these features that are over here in the right hand side, these also have the ability to turn those off, over here in the right click Menu.

The other feature I want to talk about is the Prediction Level. I'm going to start over. I'm going to delete this tool. I'm going to bring the chart back, and we're going to do a Fibonacci Ruler. We're going to, again, we're going from the top to the bottom. This is just the defaults, right off of Track 'n Trade-TNT defaults. What we're going to do, instead of turning on either the projections or the retracements, we're going to turn on the predictions.

What's the difference between predictions, retracements, or projections? The projections display the projections, shows a grid across the Time Line, so that we have Time vs the different Fibonacci Levels. We have Fibonacci Projections Levels, out here, that we can see the markets are moving through Price and Time. I'm going to turn those back off, those are projections Display Projections, turned off. I'm going to right click and I'm going to turn on Predictions. The predicted line is based on the retracement or the previous move. It's not just a series of Fibonacci Price and Time Lines. It has to do with the actual retracement of the overall market. You can see that we have A, B, A, C, B, D. But if we have to read this, we have to read it: A, B, C, D.

What we're going to do, is we're going to grab C which is our handle. You'll notice that we can move this up and down. This is now a retracement level. We're going to grab C and we're going to pull it back to the C Level, which is this retracement, right here. We can see that this market retraced to 76.0%, almost exactly. The market came down, it stopped here, retraced back to 76.4% and then it dropped down again, right into our sweet spot, down into this Time Zone of the D Zone.

This is the D, would be the Prediction Level of where we anticipate the market rallying to or falling to, in this case. Again, we're going from A, B, C, D. This ties in very closely to another tool that we use, which is the 123 Tool. Which we also use to project and predict the same basic structure to predict off into the future of where these same A, B, C projections go. This is how that is done, as well. You can see that they work hand in hand. The Fibonacci Projection, or Prediction Tool, A, B, C, D, works hand in hand with our 123 Tool. 123 predicting out to the level D point. This is how this is done by using both tools in combination. The Fibonacci Ruler, with the 123 Tool and the Preferences of the Fibonacci Ruler being able to customize it to your desired liking.

To remove this from the chart, very simply, you can either right click on the screen, or hit Delete. Or you can, if the tool is selected and has the handles on it, you can hit the Delete Key on your keyboard and it removes it from the screen, as well. Same with the 123 Tool.