A fractal in trading is a technical analysis indicator that identifies potential reversal points on a chart. It consists of a pattern of five or more bars where the middle bar has the highest high (or lowest low), and is used to spot turning points in price action.
Example
“The Williams Fractal indicator flagged a bearish fractal on the daily chart when the middle candle printed a higher high than the two candles on either side, alerting the trader to a potential trend reversal.”