Introduction
Fibonacci retracements help traders identify key support and resistance levels where price may reverse. Mastering this tool can improve your trade timing and accuracy.
1. What is Fibonacci Retracement?
🔹 A technical tool based on the Fibonacci sequence used to find potential price pullback levels.
🔹 The most common retracement levels: 23.6%, 38.2%, 50%, 61.8%, and 78.6%.
🔹 Works best in trending markets to find entry points after a pullback.
2. How to Use Fibonacci in Trading
✅ Identify the Trend – Draw Fibonacci from swing low to swing high (uptrend) or swing high to swing low (downtrend).
✅ Watch for Price Reactions – Key retracement levels act as support or resistance.
✅ Combine with Other Indicators – Confluence with moving averages, RSI, or trendlines improves accuracy.
3. Best Fibonacci Trading Strategies
🎯 Buy in an Uptrend at 38.2% or 61.8% retracements for trend continuation.
🎯 Sell in a Downtrend at 38.2% or 61.8% retracements after a pullback.
🎯 Look for Candlestick Confirmations (pin bars, engulfing candles) near Fib levels.
Conclusion
Fibonacci retracements are a powerful tool to refine entries and exits. Combine them with other strategies for better accuracy and higher success rates! 📈🔥