Fibonacci Set-up

The Fibonacci Set-up indicator provides an automated framework for plotting Fibonacci retracements based on market structure and recent swing points. This tool aims to simplify trade planning by calculating key Fibonacci levels alongside risk management metrics like position size, maximum leverage, and drawdown relative to stop-loss levels.

Usage

The Fibonacci Set-up identifies recent highs and lows using a MACD-based pivot logic to determine the current trend structure. Once a trend (bullish or bearish) is established, the indicator plots retracement levels between the identified swing points.

Users can use this script to:

• Identify Market Structure: The tool automatically labels Higher Highs (HH), Lower Highs (LH), Higher Lows (HL), and Lower Lows (LL) to define the trend.
• Plan Entries: By selecting specific Fibonacci levels (e.g., 0.500, 0.618, 0.786), traders can identify potential retracement entries.
• Risk Management: The indicator calculates the required position size and maximum leverage based on a user-defined dollar risk and the distance between the entry level and the stop-loss (SL).
• Trend Reversal: The "Reverse TP/SL Orientation" setting allows traders to flip the setup if they anticipate a counter-trend move or a trend reversal.

Details

The script utilizes a MACD (12, 26, 9) calculation, adjusted by a timeframe multiplier, to isolate significant price peaks and troughs. It tracks these points to determine if the market is in a bullish structure (Higher High and Higher Low) or a bearish structure (Lower Low and Lower High).

Retracement levels can be calculated using either Linear or Logarithmic scales, making it suitable for both traditional assets and highly volatile instruments like cryptocurrencies. The leverage calculation is dynamically adjusted based on the percentage distance to the stop-loss, ensuring that the risk remains within the user's specified maximum leverage constraint.

Settings

Pivot Points

• Timeframe Multiplier: Adjusts the sensitivity of the pivot point detection. Higher values result in wider, more significant swing points.

Specific Setup

• Reverse TP/SL Orientation: Flips the current trend interpretation and the placement of Take Profit and Stop Loss levels.
• Include Current Forming High/Low: When enabled, the indicator will use the current unconfirmed high or low in its calculations.
• Risk $: The total dollar amount you are willing to risk on the trade.
• Max Leverage: Sets a cap on the leverage calculation provided by the tool.
• Fibonacci Calculation: Choose between "Linear" or "Logarithmic" mathematical models for level placement.

Fib Selector

• Fib 0.236 - 0.887: Toggle switches to display or hide specific Fibonacci retracement levels on the chart.

Make it Neat

• Text size: Adjusts the size of the labels on the chart.
• Text Offset (%): Moves the labels vertically to avoid overlapping with price bars or lines.

FAQ

How do I interpret the leverage and position size values? The indicator calculates these based on the "Risk $" input. It determines how many units you should buy/sell and what leverage is safe so that hitting the stop-loss results in exactly the dollar loss you specified.

Can I use this on any timeframe? Yes, the Fibonacci Set-up is compatible with all timeframes. You can use the "Timeframe Multiplier" setting to tune the sensitivity to your specific chart.

How do I access Fibonacci Set-up? You can get access on the LuxAlgo Library for charting platforms like TradingView, MetaTrader (MT4/MT5), and NinjaTrader for free.