Using Fib level/retracement stops

["Peter Iovanella" <ivo1@xxxxxxxxx>]

I'm trying to figure out how best to code the following idea into a system
I'm writing, which waits for trend confirmation based on a moving average
filter, and enters in the direction of the trend based on breaks above/below
key resistance/support points.  What I'd like to do is measure the size of
the current trend, and tell the system (by way of an exit strategy) to
ExitShort if the market retraces 13% from its lowest point and ExitLong if
the market comes off 11% from it's highest point.  What I came up with was
this:

Input: Length(55)

IF MP > 0 then begin
    ExitLong at ((Highest(High,Length) - Lowest(Low,Length))*.89 +
Lowest(Low,Length)) stop;

IF MP < 0 then begin
    ExitShort at ((Highest(High,Length) - Lowest(Low,Length))*.13 +
Lowest(Low,Length)) stop;

It seems to me there's got to be a better way than just arbitrarily
assigning some Length input number, and than using the Highest and Lowest
functions, which change on a daily basis.

Ideally, I'd like to figure out some way to anchor the high of the move
(once a downtrend has been confirmed) or the low of the move (once an
uptrend is confirmed) and then Exit should the market price make high/low
and then come back off of that high/low by 11%/13%.  I guess it's just a
rather complicated way of placing a trailing stop, since as the market makes
new highs/lows, the stop level will move up/down.

So if anyone has any ideas on this, please contribute them to the list.  And
to me.  Thanks!

BJ