Prerequisite: Fibonacci retracement and anchor selection
On a small screen, scroll the figure sideways or open it full size.
Read the figure
A 50% arithmetic pullback differs from logarithmic interpolation. Chart display and drawing-tool settings must both be recorded.
Learning objective
Distinguish a display scale from the calculation used for levels.
A linear price scale gives equal space to equal absolute moves. A logarithmic scale gives equal space to equal proportional moves. Changing the display need not automatically change a drawing tool’s level calculation.
For positive anchors L and H, an arithmetic pullback uses H−r(H−L). A geometric pullback uses exp(ln(H)−r[ln(H)−ln(L)]). This second convention interpolates logarithms; it is not the same numerical grid.
Document the chart scale and the tool’s log-level option independently. The TANDEES workbench uses arithmetic levels. Compare exact displayed prices before reproducing an example in another platform. Neither convention establishes predictive power.
Worked example
For L=100 and H=400, a 50% arithmetic pullback is 250; logarithmic interpolation gives √(100×400)=200. The difference follows from the chosen convention.
Common mistakes
Do not compare two grids while assuming identical calculation settings.
Practice
Reproduce the 100→400 example and record both the axis and drawing settings.
Fibonacci workbench
Enter swing start A, swing end B and pullback C. C must lie between A and B. Retracements start at B; projections start at C. These are reference levels, not trade instructions.
Sources & further reading
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My learning pathEditorial review: 15 October 2026 · AI-assisted technical review; independent specialist review pending.
Translation available · editorial review pending