Trading with Fibonacci tools

Is it a mirage or a reality?  There are traders that build strategies around Fibonacci tools and set "rules" for entry, profit taking and exit. Many of these rules are also based on other price-derived indicators but I'll leave that for another post.
Many traders learn about Fibonacci ratios very early in their trading journey but few ever really understand why it works when it does and why it fails when it doesn't. So here's something that may help you understand it better.



Cheers, 
Trek Trader