Fibonacci Spiral

A Fibonacci spiral is a pattern that starts with a small square and builds on itself in a specific way. Each new square's side length is based on the numbers in the Fibonacci sequence (1, 1, 2, 3, 5, 8, 13, etc.). When you connect arcs inside each square, it creates a spiral shape that gets wider at a rate closely related to the Fibonacci sequence.

Traders sometimes use Fibonacci spirals to analyze charts because they can show potential support, resistance, or turning points in a market trend. The idea is that these spirals might reveal where prices could change direction based on mathematical relationships found in nature.

In essence, it's a tool some traders use to help predict future price movements based on historical patterns and mathematical ratios from the Fibonacci sequence.