Hello traders, maybe you can help a noob!
I am currently making my way through pip school, and really enjoying it 
One section has me a little stumped! You guessed it Fibonacci. I feel as if the school doesn’t quite explain the different uses for the Fib retracement tool and the extension tool.
I took the image of the schools site, the accompanying text reads…
- Move BC is .618 retracement of move AB.
- Move CD is 1.272 extension of move BC.
- The length of AB is roughly equal to the length of CD.
Now the first part i get completely, use the Fib retracement tool on points A to B, and point C should be 0.618 of this measurement. Easy pezzy.
But here is where i get confused, why do i then need to use the Fib extension tool?
What is the extension tool use for? why would i use it now? I am having difficulties understanding when to use either tool, can you ELI5?
Thank you traders.