Hi oz - just as background I dont use fibs in my trading plan...

Hi oz - just as background I dont use fibs in my trading plan but I know it is a popular indicator. As you may know, a lot of technical analysis is based on statistics, hence fibs are widely used. I personally just use technical analysis to help time entry and exit levels when investing. My plan is based off identifying major and minor levels of support and resistance and trading off those levels. The more times price hits/bounces/consolidates off a particular level, the stronger the level becomes. This is not just in relation to trading but statistics/maths generally.

I identified 5.2 as a level as it found resistance there on 7 March 2011 (you can see the wick hit 5.2 then close lower at 4.5). At that stage, based on my trading methodology, I would not be able to conclude that 5.2 was a major level of resistance, but it was certainly worth noting during the recent news flow following 2D seismic results etc during August/September 2011.

It did eventually reach 5.2 again and broke through that level without much effort (confirming that it was not very strong). In my plan I watch how the sp behaves around these levels (in this case 5.2). Once price breaks through 5.2 (minor resistance) it automatically becomes support (still minor). It went up to 5.9c (which on the surface looks great for a quick profit) but in my mind I was simply waiting for the price to pullback to 5.2c. It did exactly that. I didnt top up at 5.2 straight away as I knew that it was minor support (simply based on price action). I waited a few days and the more it consolidated at 5.2, the stronger the level became (for me). You can see that the price struggled to break down below 5.2 for about a week. This gave me confidence that 5.2 was a good level to top up.

At the end of the day (prob due to global conditions) the price broke the support level so my trade was not perfect. But that doesnt make it a bad trade. These things happen all the time. If I was day trading I would have had a stop loss but I am not trading WHN I am investing so I was not worried.

Now we can see the price move back up to 5.2c (say 5c). I cannot say that 5.9/6c is a major level, but using the same trading plan, it is the next level to watch. If it does break 6c, be patient, and wait for a pullback. If it doesnt break 6c on the next flow of news, we could see it trade between 5-6c for some time until farm-in news is out.

It is all relative. At the end of the day I am in WHN longer term but I hope this helps you out technically. You may not want to use my analysis but it works well for me.

Cheers.