The Fibonacci calculator will generate four basic Fibonacci retracement values - 23.8%, 38.2%, 50% and 61.8%. The idea behind retracement levels is that these are the support and resistance values for a stock trend at which the most important breaks or bounces can appear. You can set your stop-loss, take-profit as well as stop and limit orders at these levels or around their values.
A 38.2% retracement normally means that the prior trend will continue,
and are treated as pullbacks in an uptrend.A 61.8% retracement implies a new trend is establishing itself.
A 50% retracement implies indecision.
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