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Using the Fibonacci Retracements Tool

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With many major indices, ETFs and stocks up substantially since early March, the prospects of a pullback or consolidation are increasing. Within Sharpcharts, the Fibonacci Retracements Tool can be applied to estimate potential retracement levels after and advance or a decline. Moreover, there is more than one way to used the Fibonacci Retracements Tool. A normal CLICK of the Fibonacci Retracements Tool icon allows users to draw the 38.2%, 50% and 61.8% retracements with price levels. You can remove these levels by holding the CTRL key and clicking on the top or bottom lines of the indicator. Users can also add extra retracements of 23.6% and 1.618% by holding the CTRL key when selecting the Fibonacci Retracements Tool icon. Have at it!

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Arthur Hill
About the author: , CMT, is a Senior Technical Analyst at StockCharts.com. He has written articles for numerous financial publications including Barrons and Stocks & Commodities magazine. Focusing predominantly on US equities and ETFs, his systematic approach of identifying trend, finding signals within the trend, and setting key price levels has made him an esteemed technician. In addition to his CMT designation, Arthur holds an MBA from the Cass Business School at City University in London. Learn More
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I can't get the inner levels to disappear by SHIFT+right click. However, one thing I like to do is draw the Fib levels with 1.618 extension on an AB line and then move the whole scale to a potential CD line to show 100% and 1.618 extension of potential CD line. Reply: Use CTLR + left click to add or remove the price levels. Thanks for the feedback.

Posted by: Philip Cataldo May 16, 2009 at 10:54 AM

It does not matter because these ratios are percentage based. For a 100 point move, a 62% retracement is 62 points, regardless of the scaling. Log scaling versus arithmetic scaling is one of the eternal debates in technical analysis. It boils down to your personal preferences, timeframe and trading/investing style.

Posted by: Arthur Hill May 18, 2009 at 13:26 PM

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