Fibonacci works best when it is used with the trend, not against it. In a healthy uptrend, each pullback into a Fibonacci level is a chance to join the move at a discount; in a downtrend, each bounce into a level is a chance to sell into strength. Trend direction decides which levels you care about.
Trading with the trend
In an uptrend, wait for a pullback into the 38.2%–61.8% band and look for the trend to resume before entering long. A logical stop sits just below the swing low that anchored the retracement, because a break there means the pullback has become a reversal. In a downtrend, mirror everything: sell rallies into the band with a stop above the swing high.
Shallow retracements to 23.6%–38.2% signal a strong trend that offers little discount but high momentum. Deeper pulls to 61.8%–78.6% give better prices but demand more caution, because the deeper the retrace, the greater the risk the trend is done. Match your entry style to how far price has pulled back.
Use Fibonacci to buy dips in uptrends and sell rallies in downtrends — trade the pullback, not the reversal.
The biggest edge here is that you are aligning with structure. Fibonacci does not tell you the trend — market structure does. Read the higher highs and higher lows first, then let Fibonacci fine-tune your entry inside that trend.