What are 'Fibonacci Extensions'
Fibonacci extensions are levels used in Fibonacci retracement to forecast areas of support or resistance. Extensions consist of all levels drawn beyond the standard 100% level and are used by many traders to determine areas where they will wish to take profits. The most popular extension levels are 161.8%, 261.8% and 423.6%.
BREAKING DOWN 'Fibonacci Extensions'
In practice, most traders use Fibonacci extensions in combination with other technical indicators/patterns to help them determine appropriate target prices. As this chart shows, the 161.8% level is often used to set the price target on a breakout of an ascending triangle. This specific target is calculated by multiplying the vertical distance of the triangle by the key Fibonacci ratio of 61.8% and then adding the result to the upper resistance of the triangle.

Ascending Triangle
A bullish chart pattern used in technical analysis that is easily ... 
Fibonacci Time Zones
An indicator used by technical traders to identify periods in ... 
Breakout Trader
A type of trader who uses technical analysis to find potential ... 
Fibonacci Arc
A charting technique consisting of three curved lines that are ... 
Descending Triangle
A bearish chart pattern used in technical analysis that is created ... 
Price Target
1. A projected price level as stated by an investment analyst ...

Active Trading
Advanced Fibonacci Applications
Extensions, clusters, channels and more! Discover new ways to put the "golden ratio" to work. 
Chart Advisor
4 Triangle Breakouts Close At Hand
Triangle breakouts are close at hand in these four stocks. Here's how to trade them. 
Charts & Patterns
Continuation Patterns: Introduction To Triangles
The three types of triangle continuation patterns look different, yet provide similar information. Find out how. 
Forex Education
Top 4 Fibonacci Retracement Mistakes To Avoid
Using Fibonacci incorrectly can have disastrous consequences. Find out which common moves to avoid. 
Chart Advisor
An Ascending Triangle For Everyone
Whether a bull or bear, there are ascending triangles breaking out in both directions, and another which hasn't broken out yet but is likely to result in a big move when it does. 
Active Trading
Taking The Magic Out Of Fibonacci Numbers
Uncover the history and logic behind this popular trading tool. 
Fundamental Analysis
Using a Fibonacci Retracement
The Fibonacci retracement is the potential retracement of a financial asset's original move in price. 
Chart Advisor
Is Fibonacci Pointing To A Bounce?
Traders will watch the important Fibonacci levels to see if a move higher is in the cards. 
Charts & Patterns
Continuation Patterns: InDepth Look At Triangles
We take a closer look at ascending and descending triangles to help traders predict the ultimate breakout direction. 
Chart Advisor
Four Triangle Patterns to Keep An Eye On
These four stocks are consolidating in triangle patterns following big moves. A breakout could kick start another significant price trend.

How can a swing trader use a Fibonacci retracement?
Learn how swing traders can use Fibonacci retracements to identify areas of support and resistance, as well as entry and ... Read Answer >> 
What is a common strategy traders implement when using Fibonacci Retracements?
Learn some of the most common trading strategies that traders use in relation to the key support and resistance Fibonacci ... Read Answer >> 
How do I use Fibonacci Retracements to create a forex trading strategy?
Learn how to use Fibonacci retracements as part of an overall forex trading strategy. Fibonacci levels are carefully watched ... Read Answer >> 
Why is the Fibonacci Retracement important for traders and analysts?
Find out why traders and analysts in financial markets use Fibonacci retracement to help identify support and resistance ... Read Answer >> 
What are the most common strategies to place retracement levels?
Find out how traders place Fibonacci retracement levels, and learn what it means when a price retracement seems to reverse ... Read Answer >> 
Why are Fibonacci Clusters important in a Fibonacci Retracement Strategy?
Find out how Fibonacci clusters form and how they can be used by traders and analysts to identify support and resistance ... Read Answer >>