What's the Difference between Crypto Fibo Retracement and Fibonacci Extension?

How to use Fibo Retracement & Extension and the Difference between Fib Retracement and Extension

BTCUSD Fibonacci Retracement Areas

Fib retracement is drawn between 2 chart points but Fib extension is plotted using Three chart points.

Fibonacci Retracement Level example illustrated below where the bitcoin trend is moving downward between Chart point 1 & Chart point 2, then after the Point 2 the bitcoin crypto currency price retraces then it continues heading upwards in the original upward trend. Note that this Fib Retracement Levels indicator is drawn from Chart point 1 to Chart point 2 in direction of the market trend.

Fib Retracement Levels - How to Draw Fib Retracement Levels

Fibonacci Extension Levels

Fibonacci retracement is drawn between 2 chart points but Fibo extension is plotted using Three chart points.

To draw these Fibonacci Extension levels we wait til the bitcoin price retracement is complete & the bitcoin price starts to move in the original direction of the Bitcoin trend. Where the retracement reaches is used as chart point 3 for Fibonacci extension.

The Fibo Extension example illustrated below shows the 3 chart Points where the Fibonacci Extension indicator is drawn, labeled as chart point 1, 2 & 3. Point 1 is where the bitcoin crypto currency trend started, Point 2 is where the bitcoin crypto currency trend pulled back and retraced and Chart point 3 is where the retracement reached as shown on Fibo Extension example illustrated below.

Fibo Extension Levels - How to Draw Fibonacci Extension Levels

Please note where these Fibonacci Extension areas are plotted - Fibo Extension levels are drawn above the Fibo Extension indicator, these are the points where a trader will set the takeprofit orders.