Fibonacci retracement is a very helpful tool to identify the levels of support and resistance. It can be used to find the reversal points of the market.
There are different levels in the Fibonacci tool. These ratios are obtained from Fibonacci series and this series is obtained by the various mathematical calculations of Fibonacci numbers. In this tool, 0.382 level,0.5 level and 0.618 level are very useful.
When the stock price advances in the uptrend then it gets some pullbacks and after that the price may move again in its uptrend. but it is required to find the end of the pullback. so, we may able to enter at that end of the pullback to get the benefits of the upcoming sudden up move. during the downtrend this same thing happen. In this situation, the Fibonacci retracement tool becomes very useful to find the area of support or resistance.

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