Fibonacci can actually prove to be a very essential as well as a valuable addition to the box of tools that you use in your FOREX strategy. Even if you are a new trader in this FOREX market, then it is an advice to you that you should try out on this software once. I am going to provide you with large number of guidelines. Please do read them carefully and Experiment with these guidelines. In order to be really very successful, you just need to learn the right way to do the Fibonacci two-step process. And all the successful traders have used this trading tool and have said, “The level of success that is associated with this tool is quite amazing.”
Great Levels of Fibonacci trading tool more often indicates that how far price of a particular currency or a stock is going to go before it actually stalls and pulls back. It also provides a large number of trading levels where price of the product you possessing can pull back or even it can retrace back before moving on in the direction where trading trend is moving
Now we are going to discuss about The Levels of Fibonacci
The 4 retracement levels that are the most common ones in the FOREX market are as follows: (figures are being rounded off for better understanding):
1.    the first one is 38%
2.    next to 38% is  50%
3.    now comes the retracement level of 62%
4.    and the last but not the least is 79%
The two most common extension levels that are associated with these retracement levels are as follows:
1.    the first and the most crucial extension level is 1.27%
2.    and the second one in this list is 1.62%
By making Use of these Fibonacci tool of trading that comes with most of the charting packages, you just simply need to drag the tool from one of the most recent swing that occurred in FOREX market, be it high or be it low in comparison with the previously occurred high or low swings and do take a very special note about the retracement level of around50%.
This whole trading strategy of trading is known as a Two-Step Strategy because of the following reasons:
In actually a nutshell, the Two-Step trading strategy of Fibonacci means that you have to set an entry order that can be pulled in at the time when the price of the currency touches the level of Fib50%. You need to be really very careful about this particular level. And in order to make a great deal you need to set your trading target at the Fib1.27% extension level. However, all these FOREX strategy of trading are quite risky, but if you play your cards properly then no one can stop you from making profits.