Fibonacci Retracement Lines (Fibonacci Retracement) are often given the meaning of 'magical support/resistance' in technical analysis, such as the common values of 0.618 and 0.382.

But it is not predictive magic; it helps you understand the probability of the market 'looking back' after significant fluctuations.

This wave of movement in the chart shows:

1. A complete upward movement from the low point of the decline to the high point of the rebound;

2. During the pullback, the price fluctuates around 0.618, gathering momentum for a new upward attack.

Why can 0.618 'stop'?

Because it is not a precise price but rather a position where the emotions of the majority of traders become loose:

Those who chased the price up earlier are just losing enough here, should they cut their losses? Those looking to reverse see that it has dropped enough here; should they take a gamble?

All retracement points are essentially 'psychological anchors' where participants reassess their positions and expectations.

(Information is for reference only and should not be used as investment basis)