Trading using Fibonacci retracement with support and resistance is sort of easy. All you’ve got to try to to is to attend for zones where both collide.
a. Mark a strong/resistance zone.
b. Wait for a break out out of the zone.
c. Draw the fib retracement levels on the break out swing. Note the zone coinciding with the support or resistance zone.
d. Wait for price to bounce off the zone and take the trade.
One of the best ways to use the Fibonacci retracement tool is to spot potential support and resistance levels and see if they line up with Fibonacci retracement levels.
If Fibonacci levels are already support and resistance levels, and you combine them with other price areas that a lot of other traders are watching, then the chances of price bouncing from those areas are much higher.
With traders watching the same support and resistance levels, there’s an honest chance that there are many orders at those price levels.