Fibonacci Fan in Forex
A clear definition of Fibonacci Fan, with practical context for reading markets and making better trading decisions.
Definition
A Fibonacci Fan is a charting tool that draws diagonal lines from a key swing point using Fibonacci proportions of a selected price move.
How It Is Built
The tool starts with two significant points. Fibonacci ratios are applied to the vertical distance of the move, and diagonal lines are projected from the first point through those proportional levels.
How to Interpret It
The fan lines are sometimes treated as dynamic support or resistance references. Their usefulness depends heavily on the anchors and on whether price structure actually reacts near them.
Key Takeaway
A Fibonacci Fan converts a price swing into diagonal proportional guides. Use the guides as confluence, not as guaranteed support or resistance.
Practical forex example
Why Fibonacci Fan matters
Understanding Fibonacci Fan helps traders interpret market information, plan decisions, and manage risk with more context.
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