A Fibonacci retracement is a drawing tool that automatically marks a set of standard percentage levels - commonly 23.6%, 38.2%, 50%, 61.8%, and 78.6% - between two points you select, typically a recent swing low and swing high. Many traders watch these levels as possible zones where a pullback within a larger trend might pause or reverse, though, like support and resistance, they describe a commonly watched pattern rather than a guaranteed rule.
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See how to draw it and what each level means in Fibonacci Retracement on TradingView Explained.