How do we use Fibonacci retracement to identify support and resistance zone?

[Jayashree]

Fibonacci retracement may be used to identify support and resistance zone. Most commonly used fibonacci retracements are 61.8 and 38.2.

[Gowri Santhosh]

The Fibonacci sequence of numbers is as follows: 0, 1, 1, 2, 3, 5, 8, 13, 21, 34, 55, 89, 144, etc.

he key Fibonacci ratio of 61.8% – also referred to as “the golden ratio” or “the golden mean” – is found by dividing one number in the series by the number that follows it. For example: 8/13 = 0.6153, and 55/89 = 0.6179.

The 38.2% ratio is found by dividing one number in the series by the number that is found two places to the right. For example: 55/144 = 0.3819.

The 23.6% ratio is found by dividing one number in the series by the number that is three places to the right. For example: 8/34 = 0.2352.

 

[Srinivas]

A fibonacci retracement is a term used in technical analysis that refers to area of support or resistance. popular fibonacci retracements are 61.8 % and 38.2%

[Vinayagavel]

The fibonacci retracement is the potential retracement of a financial asset original move in price. Fibonacci retracement use horizontal lines to indicate areas of support or resistance at the key fibonacci levels before it continues in the original direction. These levels are created by drawing a trendline between extreme points and then dividing the vertical distance by the key fibonacci ratios of 23.6 %, 38.2 %, 61.8 % and 100 %

[nadarajah]

the fabonacci retracement are lines formed upto extreme point   in the flwg ratios 23.6  38.2  50  61.8  100

line at 61.8 considered to resistance zone and

line at 38.2 considered to support zone

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