Student’s Question:
Long Downward Retracement, I wouldn't be looking to go in for this trade for a long time if ever.
Power Course Instructor’s Response:
Your interpretation regarding the usage of Fib levels is correct. In the downtrend represented on your chart, the trader would be waiting for a retracement to a Fib level to take the pair short again, back in the direction of the trend.
Given that a new move the downside has taken place, we can draw a new Fib line...see the chart below...and then look for a potential retracement to the new levels which would be created.
