By: Tom Gentile
on December 16th, 2022
In case you did not know this, 50% (or 50) is not a number in the Fibonacci sequence.
It’s just that 50% of a retracement higher or lower on charts tends to be such a widely used level for support or resistance it is often used in the Fibonacci drawing tools in some charting software.
That goes for my software Toms Tools (www.tomsoptiontools.com).
We are taking the closing low of 50days ago to the recent closing high to then analyze where some key Fibonacci Retracement levels are.
Once that is placed on a chart you then wait to see if a security hits one of those levels and successfully tests that as a support or resistance.
SPY hit the 50% retracement level today on an intraday basis.
SPY is closing slightly up off it, but the day was yet another bearish reversal day.
The key to seeing this become a support is its price action from here. Whether it be a gap up on Monday or an open close to it and then becomes a bullish day so long as it closes above today’s close it could be considered a support.
App: Toms Option Tools
Market Insight articles may show images of lists of stocks meeting a variety of options parameters like Unusual Call and or Put activity or Expensive IV found on my app Toms Option Tools.
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