These are percentage values that are used to predict the length of price corrections in a trending market (either up or down). The most common trends levels used are 23.6%, 38.3%, 50% and 61.8%. These levels are created by drawing a trendlinetrend line between the highest and lowest points (0% and 100%), and then dividing the vertical distance by the retracement levels. They are used to help identify strategic placements for transactions to target certain prices, or stop losses. The theory being that significant price movements up or down will be at, or near these levels. Also called Fibonacci retracements.
Related information about retracement levels:
- Retracement Levels
The only website in the world offering proprietary algorithmic technology to forecast the probability of reversal for indices, ETFs, Forex, futures, and bonds.
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Fibonacci retracement. From Wikipedia, the free encyclopedia. Jump to: navigation, search. Fibonacci retracement levels shown on the USD/CAD currency pair.
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Jan 24, 2007 ... Fibonacci retracement is a very popular tool among technical traders and is based on the key numbers identified by mathematician Leonardo ...
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To calculate the Fibonacci Retracement levels, a significant low to a significant high should be found. From there, prices should retrace the initial difference (low ...
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In order to draw Fibonacci retracement levels, you need to click on a significant swing low and drag the cursor to the most recent swing high.