Confluence
The overlap of two or more independent technical signals at the same price level, strengthening the case for a trade.
Confluence is the principle that a price level gains significance when multiple, independent factors agree on its importance. A Fibonacci 61.8% retracement sitting at a prior swing low, on top of a rising 200-day moving average, with a high-volume node from Volume Profile — that is confluence.
No single indicator is reliable in isolation. Confluence filters low-probability setups and improves the risk/reward profile of entries. The more unrelated tools that converge, the more traders are likely watching the same zone, creating self-fulfilling interest.
Related Terms
Divergence
Price making a new high/low while a momentum indicator fails to confirm — a warning that the current move may be losing steam.
IntermediateFibonacci Extension
Fibonacci-derived levels projected beyond a swing's origin to identify potential profit targets after a breakout or trend continuation.
IntermediateFibonacci Retracement
Horizontal levels derived from Fibonacci ratios (23.6%, 38.2%, 50%, 61.8%, 78.6%) that highlight potential pullback support or resistance zones.
IntermediateMulti-Timeframe Analysis
The practice of reading price action across multiple timeframes to align the higher-degree trend with lower-timeframe entries.
IntermediateResistance
A price level where selling pressure has historically halted or reversed an upward move.
BeginnerRetracement
A partial price reversal within a larger trend, measured as a percentage of the preceding impulse move.
BeginnerSupport
A price level where buying pressure has historically halted or reversed a downward move.
BeginnerVolume Profile
A histogram of traded volume at each price level over a period, revealing where the market has done the most and least business.
AdvancedVWAP
The average price weighted by volume traded throughout the session — the institutional benchmark for execution quality.
Intermediate