Fibonacci Calculator

Fibonacci retracement is a technical analysis tool that uses horizontal lines to indicate areas of support or resistance at the key Fibonacci levels before the price continues in the original direction. These levels are derived from the Fibonacci sequence and are expressed as percentages: 23.6%, 38.2%, 50%, 61.8%, and 78.6%.

The 61.8% level, known as the “golden ratio,” is considered the most significant. When price retraces to this level during an uptrend, it often finds strong support. Traders use these levels to identify potential entry points, set stop-loss orders, and determine profit targets.

The 61.8% retracement (the golden ratio) and the 38.2% level are the most watched by institutional traders. In strong trends, price often retraces only to the 38.2% level before continuing. In weaker trends or during consolidation, deeper retracements to 61.8% or even 78.6% are common. A retracement beyond 78.6% typically signals that the original trend has reversed rather than paused.

The 50% level isn't technically a Fibonacci number, but it's included because markets frequently retrace half of a major move. Many traders consider a 50% retracement the "line in the sand" — holding above it suggests the trend is intact, breaking below it suggests a deeper correction.

Fibonacci extensions project price targets beyond the original move. The 127.2% and 161.8% extensions are the most commonly used for setting take-profit orders. For example, if a stock rallies from $100 to $150 and then retraces to $130, the 161.8% extension projects a target of $180.80 — calculated as $130 + (($150 - $100) × 1.618).

Professional traders combine Fibonacci levels with other confluence factors: moving averages, previous support/resistance zones, volume profiles, and candlestick patterns. A Fibonacci level that aligns with a 200-day moving average and a previous support zone is far more reliable than a Fibonacci level in isolation.