📝 What is Fibonacci Retracement Tool?

🔢 What is Fibonacci Retracement Tool? 🤔 Fibonacci Retracement is like a magic measuring tape 🧵 that traders use to find where the price may stop or reverse. It helps you know “where to buy” and “where to sell” based on past price moves — just like predicting where a bouncing ball will stop! 🏀 🎯 Why is Fibonacci Retracement Used? ✔️ To find possible support and resistance levels. ✔️ To spot points where the price might take a break 🧘‍♂️ or reverse direction 🔄. ✔️ To help decide where to enter (buy) and exit (sell) trades. Traders believe that prices never move straight up or down — they always pull back a little before continuing. This tool guesses these pullback points — like road signs telling where the next turn or stop may be! 🛑➡️ 🔍 How Does Fibonacci Retracement Work? When the price of a stock jumps UP or falls DOWN sharply, traders use this tool to draw lines at important levels: ✔️ 23.6% ✔️ 38.2% ✔️ 50% ✔️ 61.8% ✔️ 78.6% These numbers may sound odd — but they are part of the Fibonacci Series — a magical number system found in nature 🌿, shells 🐚, and even galaxies 🌌! These lines show where price may pause, bounce, or reverse — just like stairs 🚶‍♂️ where the price rests before going higher or lower. 🟢 When to Buy? (Possible Signal) ✔️ If the price is falling but touches an important Fibonacci level (like 61.8% or 50%) and starts to rise — traders may BUY. ✅ Like a rubber ball bouncing up after hitting the floor! 🏀⬆️ 🔴 When to Sell? (Possible Signal) ✔️ If the price is rising but touches a Fibonacci level and starts to fall — traders may SELL or book profits. ⚠️ Like a ball thrown up that slows down and comes back! 🎾⬇️ 🎨 Real-Life Simple Example: Imagine you throw a basketball 🏀 towards the wall. Does it stop suddenly? No! It hits the wall and bounces back naturally. Similarly — when the price hits these Fibonacci levels, it may also stop or reverse like a bouncing ball or a wave hitting the shore 🌊. 💡 Bonus Tips: ✔️ Best used in trending markets (uptrend or downtrend). ✔️ Works better when combined with other tools like RSI, MACD, Bollinger Bands for extra confidence! 🎯 🎉 Summary in Very Simple Words: 🔹 Fibonacci Retracement = Special lines that show where the price may pause or reverse. 🔹 Important Levels: 23.6%, 38.2%, 50%, 61.8%, 78.6%. 🔹 Price may bounce like a ball near these levels! 🎾 🔹 Great for knowing possible entry and exit points! 🚪 🛡️ Disclaimer: ⚠️ Disclaimer: The content provided on this website is for educational and informational purposes only. It should not be considered as investment advice, stock tips, or financial recommendations. Always do your own research or consult a SEBI-registered investment advisor before making any trading or investment decisions. 📢