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What Are Fibonacci Retracements

Fibonacci retracements are tools used by traders to identify key levels of support and resistance after significant market movements. Key levels, such as 0.50% and 0.618%, are plotted on charts to indicate potential retracement areas before the market resumes its trend. Traders typically place buy or sell orders near these levels with stop losses set below the 0.786% level.

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3 views3 pages

What Are Fibonacci Retracements

Fibonacci retracements are tools used by traders to identify key levels of support and resistance after significant market movements. Key levels, such as 0.50% and 0.618%, are plotted on charts to indicate potential retracement areas before the market resumes its trend. Traders typically place buy or sell orders near these levels with stop losses set below the 0.786% level.

Uploaded by

itouchmyself060
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PDF, TXT or read online on Scribd
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What are Fibonacci retracements ?

Fibonacci retracements identify key levels of support and resistance. Fibonacci levels are
commonly calculated after a market has made a large move either up or down and seems to have
flattened out at a certain price level.

Traders plot the key Fibonacci retracement levels of 0.50 percent and 0.618 percent by drawing
horizontal lines across a chart at those price levels to identify areas where the market may
retrace to before resuming the overall trend formed by the initial large price move.

You can buy or sell near the0.50 percent level and 0.618 percent levels with the stop loss
plased below the 0.786 percent level

Traders use the Fibonacci retracement levels as potential support and resistance areas.

In order to apply Fibonacci levels to your charts, you’ll need to identify Swing High and Swing
Low points.

For up trend

For uptrend you have to take Fibonacci to swing


swing low to swing high

For example
For down trend

For down trend you have to take Fibonacci to swing high to swing low

For example

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