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Fibonacci retracement levels can be used to identify your entry points (support level), to set your exit points (resistance levels), or to decide where to put your stop-loss order. The usual method for limiting losses with a stop order is placing the stop order slightly below a Fibonacci level.

For example, if you used Fibonacci retracement to find support levels and your entry point is at the 0.5 Fibonacci level, then a stop loss can be placed slightly below 0.618 or 0.786. If your entry point is at 0.618, stop loss can be placed below 0.786 or 1 (the swing low).