Fibonacci Retracement
A Fibonacci Retracement is a predictive technical indicator used to forecast potential price reversals or trend shifts in a stock or index. It employs horizontal lines drawn at key Fibonacci ratios (e.g., 23.6%, 38.2%, 50%, 61.8%) to highlight possible support and resistance levels. The logic assumes that after a new trend starts, prices often retrace to a prior level before resuming the trend. In action, traders use this tool to identify where reversals might occur, aiding decisions on entry or exit points. It’s a valuable method for mapping price corrections or continuations in trading.
Related Terms
Accumulation/Distribution Indicator (A/D)
The Accumulation/Distribution (A/D) Indicator is a technical analysis tool used to determine the trend of...
Annual Net Profit Margin
Net Profit Margin is a ratio showing a company’s net profit as a percentage of...
Dividend Stocks
Dividend stocks are shares of companies that distribute a portion of their profits to shareholders...
Filing
Filing refers to submitting essential documents to SEBI before an Initial Public Offer (IPO). This...
Industry Analysis
Industry analysis is a technique for evaluating an industry’s competitive landscape, potential profitability, supply-demand dynamics,...
Lump Sum
A lump sum is a single, one-time payment made in full, rather than in smaller,...
