Retracement: meaning, definitions and examples
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retracement
[ rɪˈtreɪsmənt ]
finance
A retracement refers to a temporary reversal in the direction of a stock's price that goes against the prevailing trend. It is often used by traders to identify potential levels of support or resistance.
Examples of usage
- The stock experienced a retracement before continuing its upward trend.
- After reaching a new high, the market saw a retracement back to previous levels.
- Traders use Fibonacci retracement levels to predict potential areas of price reversal.
Translations
Translations of the word "retracement" in other languages:
🇵🇹 retração
🇮🇳 पुनर्प्राप्ति
🇩🇪 Rückzug
🇮🇩 retraksi
🇺🇦 відкат
🇵🇱 retrakcja
🇯🇵 後退
🇫🇷 retrait
🇪🇸 retroceso
🇹🇷 geri çekilme
🇰🇷 철회
🇸🇦 تراجع
🇨🇿 retracement
🇸🇰 retracement
🇨🇳 回撤
🇸🇮 umikanje
🇮🇸 afturköllun
🇰🇿 қайталау
🇬🇪 უკანდახევა
🇦🇿 geri çəkilmə
🇲🇽 retroceso
Etymology
The term 'retracement' in the context of finance originated from the field of technical analysis. Traders and analysts use retracement levels to determine potential areas where a stock's price may reverse its direction temporarily. The concept is based on the idea that stock prices tend to move in waves, and retracements can provide opportunities for traders to enter or exit positions. By studying historical price movements, traders can identify key levels where retracements are likely to occur.