Waddah Attar’s Weekly Pivot Indicator & Strategy
Before I completely mastered how to draw correct horizontal support and resistance lines, I needed someone to help me out. So I tried out a variety of indicators. One of my favorite ones is created by Waddah Attar, a Forex trader and I find it pretty accurate! The indicator is called Waddah Attar’s Weekly Fibo but don’t let the “weekly” part scare you because I promise that you can use it on lower timeframes. By the way, the “Fibo” stands for Fibonacci and you can read more about that here. I will also give you some tips on how to trade using this indicator and turn it into a powerful strategy so let’s get started, shall we?
Setting up Waddah Attar’s Weekly Fibo
Since this is a custom indicator, you first need to download it here. Then put it in your “Indicators” folder for MetaTrader 4. If you don’t know where that is, open MetaTrader 4 and press F4. You should see the MetaEditor and in the navigator window on the left you will see the indicators icon, right click on it and select “open folder”. Now you can cut and paste the indicator in there but before you can use it, you must close and reopen MetaTrader.
Explaining Waddah Attar’s Weekly Fibo
If you did it right, you will see some blue horizontal lines on your charts as well as the Fibo percentage but also the current price at the bottom left on the charts. Count the blue lines, there should be a total of 7 which are either support or resistance. Below each line, the Fibo percentage is displayed too. The first line at the bottom is 0% and the last line at the top is 100%. In between these two, you will find the following Fibo levels: 23.6, 38.2, 50, 61.8 and 76.4%. Remember, the percentage is always shown at the bottom so even if price isn’t at any of these lines, just look there to see at what Fibo level you are – if you want to know.
Moving on, the Fibonacci levels work as either support or resistance lines and they are based on weekly highs and lows from the weekly timeframe. However, preferred timeframes for taking trades based on the lines are below H4 but above M15.
Notice that since the lines are based on the weekly highs and lows, sometimes there is a good distance in between two areas and you might want to also add your own support and resistance lines. After all, this is supposed to be a “helping hand” so learn from how it draws the lines and also add your own lines based on the Daily and H4 charts or lower! You wanted to learn, remember?
Using the Indicator in a Strategy
How you use the indicator is up to you of course but I will give you some pointers!
You can either use the blue lines drawn by this indicator as “targets” to go with the trend towards them or trade the blue lines themselves as either support or resistance. For a while I tested this indicator together with Bollinger bands with Period 50, Deviation 2. I found out that often times one of the three lines of the Bollinger Bands was overlaying one of the Waddah Attar’s Fibo levels. That worked as an extra confirmation! You may also see areas where price gets out of the Bollinger Bands’ upper or lower line and if it reaches a weekly support or resistance line at that time, it’s a great indication that price can fall back inside the bands!
Here are a few examples:
Look carefully, you can see several decent areas to get in on either a call or put option where the B-band is intercepting the weekly Fibo’s lines! I have also pointed out an area where price got out of the upper B-Band and went straight up to the next weekly resistance level (next Fibo level).
After that, price fell back inside the Bollinger Bands once again. There are of course other indicators you can use it together with – this was just a suggestion so choose whatever works for you.
Fibonacci + Weekly Charts = Powerful Indicator
The weekly charts are great for providing significant and strong support and resistance levels and the indicator does a great job automatically drawing them on your charts. Waddah Attar has also created an indicator called “Monthly Fibo” – you guessed it, it uses the Monthly charts highs and lows instead of the weekly. So if you prefer higher timeframes like H4 and above, you can switch to Attar’s Monthly Fibo but it works the same way! Practice on drawing your own lines as well and pay attention to trends and the overall price action. Sounds hard? Then just use the B-band + Weekly Fibo combination to get your feet wet. Happy trading!