Fibonacci Retracement
Horizontal levels drawn from Fibonacci ratios, used to anticipate where a pullback might find support.
Fibonacci retracement draws horizontal levels at ratios derived from the Fibonacci sequence (notably 38.2%, 50%, 61.8%) between a price low and high, on the theory that pullbacks often reverse near these levels before the trend resumes.
It’s enormously popular in crypto charting, and its levels sometimes appear to “work” — but much of that is self-fulfilling (so many traders watch the same levels that orders cluster there) and confirmation bias (misses are forgotten). There’s no rigorous evidence markets inherently respect these ratios. Use it, if at all, as one framework for placing potential support/resistance zones, not as a law of price.