Fibonacci Retracement levels are horizontal lines that indicate where support and resistance are likely to occur. They are based on the Fibonacci sequence, a series of numbers where each number is the sum of the two preceding ones.
In trading, the most common ratios derived from this sequence are 38.2%, 50%, and 61.8%. These percentages represent how much of a prior move the price has 'retraced' or pulled back.
On StressTest.pro asset pages, we display the percentage distance of the current price from these key Fibonacci levels based on the 52-week high and low. If an asset is pulling back, these levels often act as 'floors' where buyers may step in. If the price breaks through a major Fibonacci level, it can signal a significant trend change.