Fibonacci Retracement

Fib Retracement settings

Precise Market Geometry

The Fibonacci Retracement tool is essential for identifying potential reversal zones during a trend. Instead of drawing lines manually every time the market moves, this indicator automatically identifies the most relevant recent swing and plots key retracement levels for you.

This feature is designed to help you spot "discounted" entry prices in an uptrend or "expensive" entry prices in a downtrend.

Key Levels Explained

We automatically plot the most critical Fibonacci ratios used by institutional traders:

• 0 (0%): The start of the retracement (Swing High/Low).

• 0.382 (38.2%): Shallow Retracement.

  • Usage: Strong potential trend continuation. If price bounces here, the momentum is very high.

• 0.5 (50%): Equilibrium.

  • Usage: The midpoint of the swing. Often acts as a psychological support/resistance level.

• 0.618 (61.8%): The Golden Pocket.

  • Usage: The most famous reversal ratio. A highly probable area for price to turn.

• 0.705 (70.5%): OTE (Optimal Trade Entry).

  • Usage: A precision level often used by algorithmic traders for deep retracement entries.

• 0.79 (79%): Deep Retracement.

  • Usage: The "last line of defense" before a full reversal. Entries here offer excellent Risk/Reward ratios.

• 1 (100%): The invalidation point (Swing High/Low).

Zones of Interest

To simplify your chart, we verify two distinct zones based on depth:

1. Shallow Pullback Zone

• Range: 0.382 – 0.50

• Meaning: This zone represents a minor correction in a strong trend. Aggressive traders look for entries here to catch continuation moves quickly.

2. Deep Retracement Zone

• Range: 0.705 – 0.79

• Meaning: This is the "sweet spot" for high R:R trades. Price has pulled back significantly, offering a cheap entry before the trend (ideally) resumes. This area is often referred to as the "Kill Zone" or "OTE".