Fibonacci Retracement Strategy for Crypto

The Enhanced Fibonacci Retracement Strategy is designed to help traders capitalize on key Fibonacci levels for both long and short trades. This script automatically identifies significant swing highs and lows within a customizable lookback period and dynamically plots Fibonacci retracement levels (0%, 23.6%, 38.2%, 50%, 61.8%, 78.6%, and 100%) as support and resistance levels.

Key Features:
Automatic Fibonacci Levels:
The script identifies the highest high and lowest low over a user-defined lookback period to calculate Fibonacci retracement levels.

Dual-Directional Trading:

Long Trades: Triggered when the price crosses above the 61.8% retracement level, anticipating a reversal.

Short Trades: Triggered when the price crosses below the 38.2% retracement level, capturing potential downward movement.

Compact Line Option:

Users can toggle "Compact Fibonacci Lines" to reduce visual clutter on the chart, making the lines shorter and easier to interpret.

Dynamic Alerts:

Alerts are embedded directly into the strategy logic for entry and exit points.

Long Entry: Triggered when the price bounces above the 61.8% level.

Long Exit: Triggered when the price reaches the 23.6% level.

Short Entry: Triggered when the price crosses below the 38.2% level.

Short Exit: Triggered when the price reaches the 78.6% level.

Clear Visualization:

Fibonacci levels are plotted with distinct colors and dashed lines (optional compact view),

providing traders with clear and actionable levels to make decisions.

Inputs:

Lookback Period: Number of candles to calculate swing highs and lows.
Plot Fibonacci Levels: Toggle to enable/disable plotting levels.
Compact Fibonacci Lines: Reduce the length of Fibonacci lines for a cleaner chart.

How It Works:

The strategy identifies a high-low range within the lookback period.
Fibonacci levels are calculated based on the range and plotted on the chart.

Long Trade Example:

Enter when the price crosses above the 61.8% level.

Exit when the price reaches the 23.6% level.

Short Trade Example:

Enter when the price crosses below the 38.2% level.

Exit when the price reaches the 78.6% level.

Best Use Cases:

Trending Markets: Use retracements to time entries in the direction of the trend.
Range-Bound Markets: Identify and trade reversals near key Fibonacci levels.
Important Notes:

This strategy is not financial advice and should be backtested thoroughly before live trading.
Risk management is crucial! Consider using stop-loss orders for protection.

Customize inputs to suit your preferred timeframe and trading style.