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DEFINITION of 'Fibonacci Arc'
A charting technique consisting of three curved lines that are drawn for the purpose of anticipating key support and resistance levels, and areas of ranging.
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BREAKING DOWN 'Fibonacci Arc'
Fibonacci arcs are created by first drawing an invisible trendline between two points (usually the high and low in a given period), and then by drawing three curves that intersect this trendline at the key Fibonacci levels of 38.2%, 50% and 61.8%. Transaction decisions are made when the price of the asset crosses through these key levels.
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How can a swing trader use a Fibonacci retracement?
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