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Thinkorswim—Fibonacci Retracements and multiple EMAs

With EMA (Exponential Moving Averages)—you can start identifying supply and demand zones, and time entries and exits by observing confluence between key technical levels and price behavior.

🔍 1. Identify Demand and Supply Zones​

These are areas where price has historically reversed or shown strong reaction. You can use:

A. Fibonacci Retracement Levels​

From your screenshot, you're using:

  • 0.236, 0.382, 0.5, 0.618, 0.786 — key retracement zones.

How to use:

  • After a strong move (up or down), draw fibs from swing low to high (for pullback in uptrend) or swing high to low (for retracement in downtrend).
  • The 0.618 and 0.786 zones are typical demand (buying) zones in an uptrend.
  • Conversely, 0.236 and 0.382 zones often act as supply (selling) zones in a downtrend.

Look for price consolidating or reversing near these levels, especially if supported by EMA or volume signals.

🔄 2. Time Entry and Exit Using EMAs​

You're using:

  • Fast EMA: 9
  • Mid EMA: 14
  • Slow EMA: 21
  • Medium-Long: 50
  • Long-Term: 200

This is a strong trend-following system. Here's how to use it:

Entry Timing​

  • Look for EMA crossover setups: e.g. when the 9 EMA crosses above the 21 EMA, it’s a bullish signal.
  • Entry zones are stronger if price is bouncing off the EMA21 or EMA50, which acts as dynamic support/resistance.
  • If the price pulls back to a Fib retracement level and overlaps an EMA, that’s a strong confluence zone for entry.

Exit Timing​

  • Set profit targets near opposite Fib levels or prior supply zones.
  • Exit or partial exit when price extends too far from EMAs, indicating exhaustion.
  • Exit if EMAs flatten or begin to cross in the opposite direction (trend reversal).

🧠 Pro Tips for Pinpointing Entries/Exits​

  • Demand Zone Entry: Bullish candle off Fib + EMA confluence (e.g., price bounces at 0.618 + EMA21 support).
  • Supply Zone Exit: Price touches 0.236/previous high + starts rejecting.
  • Combine with volume spike or divergence for confirmation.
  • Use candlestick patterns (e.g., bullish engulfing at demand, shooting star at supply) to fine-tune.

🔵 What Is the Blue Line?​

The blue line labeled VWAP_Line in your EMA setup is the VWAP (Volume Weighted Average Price).

  • VWAP acts as an intraday mean price and is often used by institutions.
  • If price is above VWAP, it suggests bullish momentum.
  • Price pulling back to VWAP and bouncing is a great long entry.
  • Conversely, rejection from VWAP in a downtrend = short signal.

🧭 Summary Strategy​

ActionIndicator ComboCondition
Buy EntryFib + EMA9/21 + Bullish CandleAt 0.5/0.618 level or EMA21 support
Sell EntryFib + EMA9/21 + Bearish RejectionNear 0.236/0.382 level or previous supply
ExitFib Targets or EMA crossPrice hits Fib extension or EMAs flatten/reverse
ConfirmationVWAP + VolumePrice above VWAP w/ strong volume = confidence boost