How to Trade Fibonacci Pullbacks

Backtested

A great question from a StatsEdge Pro member turned into this week’s deep dive: Is Fibonacci actually useful in trading?

The short answer: there’s no “magic” in Fibonacci — but it works as a systemized framework for pullbacks and extensions. And if you’re trading pullbacks, systemizing your entry zones can dramatically sharpen your edge.

Here’s how we break it down:

• 🔁 Pullbacks between 33%, 50%, and 66% of a prior move are where many trades set up best.

• 🎯 Extensions like 1.618 (or just “move 1 + two-thirds of move 1”) offer realistic, statistically sound targets.

• 🛠️ Most platforms let you customize these levels. Want 25% pullbacks? Or 75% extensions? Test it. Track it. Optimize it.

📈 Our pullback system — backtested to 2000 — doesn’t use Fib directly, but the logic aligns: we look for sharp moves, then controlled retracements into high-probability zones.

Want a rules-based way to “buy the dip” with confidence — not vibes?

👉 All the stats, backtests, and setups are at www.statsedgetrading.com