In trading, a Fibonacci short refers to a bearish trading strategy that involves selling a financial asset, such as stocks, commodities, or currencies, based on the principles of Fibonacci retracement levels. Fibonacci retracement levels are derived from the Fibonacci sequence and are used by traders to identify potential reversal points in a price trend.

When initiating a Fibonacci short trade, a trader typically identifies a downtrend in the asset's price and waits for a retracement to occur. The trader then uses Fibonacci retracement levels, such as 38.2%, 50%, or 61.8%, to identify potential resistance levels where the price may reverse and continue its downtrend.

The idea behind a Fibonacci short is to enter a short position (sell) at or near these Fibonacci retracement levels, anticipating a continuation of the overall downtrend. Traders often use other technical indicators or chart patterns in conjunction with Fibonacci analysis to increase the probability of a successful trade.

It's important to note that while Fibonacci retracement levels can be valuable tools for technical analysis, no strategy is foolproof, and traders should use risk management techniques to protect their capital. Additionally, market conditions can change rapidly, so it's crucial to stay informed and adapt strategies accordingly.
Harmonic PatternsTrend Analysis

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