Trader's Glossary

FibonacciFibonacci Retracement

Levels at 0.236 / 0.382 / 0.5 / 0.618 / 0.786 of a prior swing — common pullback targets.

Fibonacci retracement levels (0.236, 0.382, 0.5, 0.618, 0.786) are derived from the Fibonacci sequence and represent statistically common pullback targets. The 0.618 (golden ratio) is the highest-probability reversal level — institutions often use it for re-entries.

Draw Fibs from the most recent significant swing low to swing high (or vice versa). Look for confluence: Fib 0.618 + order block + bullish candle = entry. The 0.5 level doubles as the premium/discount equilibrium line for smart-money traders.