Fibonacci Retracement Calculator
Quickly compute fibonacci retracement with accurate formulas. See amortization schedules, growth projections, and side-by-side comparisons.
Fibonacci Retracement Calculator
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Formula: Retracement Level = High − (Range × Fib Ratio) [uptrend] | Low + (Range × Fib Ratio) [downtrend]
Worked example — OTE Zone: 1.0843–1.0876 | Golden Ratio: 1.0876
Formula
Retracement Level = High − (Range × Fib Ratio) [uptrend] | Low + (Range × Fib Ratio) [downtrend]
Fibonacci retracement levels are calculated by taking the difference between the swing high and swing low (the range) and multiplying by each Fibonacci ratio. For an uptrend, levels are subtracted from the high to show support below. For a downtrend, levels are added to the low to show resistance above. The OTE zone spans the 61.8% to 78.6% retracement levels.
Worked Examples
Example 1: EUR/USD Bullish Retracement
Problem:Swing Low: 1.0800, Swing High: 1.1000. Calculate retracement levels.
Solution:Range = 1.1000 - 1.0800 = 0.0200 23.6% = 1.1000 - (0.0200 × 0.236) = 1.0953 38.2% = 1.1000 - (0.0200 × 0.382) = 1.0924 50% = 1.0900 61.8% = 1.0876 78.6% = 1.0843 OTE Zone: 1.0876–1.0843
Result:OTE Zone: 1.0843–1.0876 | Golden Ratio: 1.0876
Example 2: GBP/USD Bearish Retracement
Problem:Swing High: 1.2700, Swing Low: 1.2500. Calculate levels for a bearish retracement.
Solution:Range = 0.0200 38.2% = 1.2500 + (0.0200 × 0.382) = 1.2576 50% = 1.2600 61.8% = 1.2624 78.6% = 1.2657 Look for sell setups at 61.8-78.6% retracement
Result:OTE Zone: 1.2624–1.2657 | 50% midpoint: 1.2600
Frequently Asked Questions
What is Fibonacci retracement in trading?
Fibonacci retracement is a technical analysis tool that uses horizontal lines to indicate areas of support or resistance at key Fibonacci levels before price continues in the original direction. The levels are derived from the Fibonacci sequence and represent ratios: 23.6%, 38.2%, 50%, 61.8%, and 78.6%. Traders draw these levels between a significant swing high and swing low. The theory is that after a significant price move, price will often retrace to one of these levels before continuing. The 61.8% level (known as the golden ratio) is considered the most significant.
What is the OTE (Optimal Trade Entry) zone?
The OTE (Optimal Trade Entry) zone is a concept from ICT (Inner Circle Trader) methodology that identifies the 61.8% to 78.6% Fibonacci retracement zone as the ideal area for trade entries. This zone represents a deep enough retracement to offer a good risk-to-reward ratio while still being within the range where price is likely to reverse and continue in the original trend direction. Traders look for additional confirmation within the OTE zone, such as order blocks, fair value gaps, or displacement, before entering trades. Two conventions for the same band circulate in ICT material and both appear on this site: the strict Fibonacci pair 61.8% to 78.6% used here, and the rounded 62% to 79% band with a 70.5% midpoint used on the dedicated OTE calculator. On a 200 pip leg the two versions differ by well under a pip, so pick one and stay with it rather than treating them as different zones.
How do I draw Fibonacci retracement levels correctly?
For an uptrend: draw from the swing low to the swing high. The retracement levels will appear below the high, indicating potential support levels where price may bounce. For a downtrend: draw from the swing high to the swing low. The levels will appear above the low, indicating potential resistance levels. Always use significant swing points, not minor fluctuations. Higher timeframe Fibonacci levels are more significant than lower timeframe levels. The swing points should be clear and obvious — they should be the highest/lowest points of a defined move.
Which Fibonacci level is most important for trading?
The 61.8% level (golden ratio) is widely considered the most important Fibonacci level. When price retraces to this level, it indicates a strong pullback while still maintaining the overall trend structure. The 38.2% level represents a shallow retracement in strong trends. The 50% level, while not technically a Fibonacci ratio, is included because markets frequently retrace half of a move. In ICT methodology, the 61.8-78.6% zone (OTE) is considered optimal. Many traders look for confluence — where multiple Fibonacci levels from different swings align at the same price.
What are Fibonacci extensions and how are they different from retracements?
Fibonacci retracements identify potential reversal levels within a price move (between 0% and 100%), while Fibonacci extensions project levels beyond the original move (above 100%). Common extensions are 127.2%, 161.8%, 200%, and 261.8%. Extensions are used to set profit targets — for example, after entering at the 61.8% retracement, a trader might target the 127.2% or 161.8% extension. Fibonacci Retracement Calculator projects them in the direction of the original leg: for an up move they are measured up from the swing low, so 127.2% sits above the swing high, and for a down move they are measured down from the swing high. Extensions answer 'how far might price go beyond the original move?' while retracements answer 'how far might price pull back before continuing?'
Where do the 23.6, 38.2, 61.8 and 78.6 percent ratios actually come from?
They come from the Fibonacci sequence, where the ratio of consecutive terms converges on phi, roughly 1.618. Its inverse, 1 divided by 1.618, gives 0.618 — the golden ratio behind the 61.8 percent level. Squaring 0.618 gives 0.382 and cubing it gives 0.236, which is where the 38.2 and 23.6 percent levels originate. The 78.6 percent level is the square root of 0.618. The 50 percent line is not a Fibonacci ratio at all and survives purely on the market habit of giving back half a move.
What does it mean when price retraces beyond the 78.6 percent level?
Below 78.6 percent on an uptrend retracement you are outside the OTE zone and approaching a full round trip of the leg. The market has handed back almost all of the impulse, so the move starts to read as a reversal rather than a pullback inside the trend. Many traders treat a decisive close beyond the 78.6 or 100 percent level as invalidation, stand aside, and wait for a fresh swing high and swing low to form before redrawing the range.
Should I enter at the 38.2 percent level or wait for the 61.8 percent level in a strong trend?
It is a trade-off between fill probability and reward. Shallow 38.2 percent pullbacks are typical of strong momentum trends, so holding out for 61.8 percent risks never being filled at all. Deep 61.8 to 78.6 percent retracements show up more often in corrective or ranging conditions and leave a tighter stop behind the swing point, so each unit of risk buys more reward. A common compromise is to scale in, taking part of the position at 38.2 or 50 percent and adding inside the OTE zone.
Should I anchor Fibonacci levels to candle wicks or candle closes?
Wicks capture the true extreme of the swing including any stop run; closing prices capture where the market actually settled and ignore single-print spikes. Because Fibonacci Retracement Calculator works from whatever swing high and swing low you enter, the two conventions produce different ranges and therefore different retracement levels. Neither is objectively correct, but mixing them is a real problem — pick one convention and apply it to every swing so your levels stay comparable across charts and timeframes.
Does using a logarithmic price scale change where the retracement levels sit?
On a linear scale the range is a plain price difference, which is what Fibonacci Retracement Calculator uses, so the 50 percent level of a move from 1.0800 to 1.1000 sits at 1.0900. A logarithmic scale measures the same percentages against proportional change, which nudges the intermediate levels. The difference is negligible on forex pairs that travel a few percent, but it becomes material on stocks or crypto that have multiplied several times over, where log-scaled levels are the better reference.
References
Reviewed for accuracy by Daniel Agrici, Founder & Lead Developer · Editorial policy
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