50% retracements

[ProfLogic]

Quote from fantastic4:

proflogic, take a look through historic charts and watch some live and you'll see how they work. I think it's based on psychology and of course the fibonacci sequence. Hey, the ratio of male bees to female is the number PHI, and it so happens that the ratio between when traders psychology recongnizes a time to sell and buy is the number phi. There's also a very practical side to it. Some people double down, so when price moves back 50%, that's a chance for them to get out at break even, so we can get a support resistance line there. 50% is also a big number/area that alot of people can see and look at, kind of like how a big round number can become support/resistance.

Here I"ll post a picture of some fib retracements/ pullback from last night, I've got my fib lines set to show only the fifty - 61.8 zone:

fantastic4, I've been researching price action for 15 years and trade for a living. I watch live charts from anywhere between 4 and 8 hours, five days a week. That being said I absolutely agree with you that psychology plays a good deal into it but there is nothing consistent about any retracement percentages. Fib retracements make general assumptions that those retracements will occur with consistency at the levels of 38.2, 50 or 61.8% but most traders will tell you that if price gets CLOSE to those percentages . . . Fibs work. That is statistical bologna. If one opens the view of those percentages by 5% on either side (which most traders do) then any retracement of between 33.2 and 66.8% is then valid.

Let me stick a bug in your head. What is important is that THERE ARE ALWAYS RETRACEMENTS not how much a move will retrace. Learn to read where each retracement has completed so you can then trade with the direction of strength not EVER against it. Stop guessing at where the retracement will go and start reading what is happening with price where it IS!