What is Fibonacci?

Fibonacci is a sequence of number, start from 1,1,2,3,5,8,13,21,,34,55,89... to infinity, discovered by Leonardo Fibonacci.
The sum of the two previous consecutive numbers equals the next number.
The ratio of any number to its next highest number approaches .618. The ratio of alternating numbers approaches .382. Also, 1 - .618 = .382. The midpoint of .382 and .618 is .50. This is why .382, .50, and .618 are used.

Fibonacci retracements are used in trading to determine support and resistance (and potential turning points) during a trend.
Calculate the distance from the low to the high of the trend and calculate 38.2%, 50% and 61.8% of the distance of the trend. Subtract those values from the top of the trend.
Those levels should act as support and resistance and provide clues to where the market is heading next.