Trust numbers to learn more about your: 1. Pivot points2. Position size3. Support & resistance levels
To a trader, a pivot is a significant price level,similar to an inflection point, where they expectprice to either continue in the current direction orreverse course.Pivot points are calculated using the high, low, andclosing prices from previous trading sessions andare used to forecast support and resistance levelsfor the current or upcoming session.
The size of a position within a portfolio, or the dollaramount that an investor will trade, is referred to asposition size. Position sizing is used by traders todetermine how many units of a security they can tradein order to control risk and maximize returns.You must calculate position size because if your stoplosses are too far apart from your entry point, you risklosing a lot of money before realizing that prices maynot recover quickly. A trade's ideal position size iscalculated by dividing the amount at risk or the accountrisk limit by the trade risk.
Fibonacci is a number series in which a number is foundby adding two numbers before it. Fibonacci ratios, suchas 61.8 percent, 38.2 percent, and 23.6 percent, arefrequently used on charts. When a stock, for example,moves sharply upward or downward, it tends to retraceits steps before making the next move.
Using the fibonacci calculator helps you to draw supportand resistance lines, as well as to place stop-loss ordersand set target prices. Fibonacci ratios can even be usedas the main mechanism in a counter trend tradingstrategy. It demonstrates how much of a previous movethe price has retraced. The previous trend is likely tocontinue in the same direction.