mass psychology and self-fulfilling TA

i'm confused on the mass psychology....for example, Fibonacci retracements are commonly said to be self-fulfilling because so many people trade based on them. but that doesn't make sense for me.

for example, if at the 1st retracement it says that people should go short, and everyone shorts, wouldn't that mean that supply falls dramatically, and thus price should rise instead of falling?

same with common candlestick reversal patterns....like if there's a hammer at after a downtrend it should reverse....but if everyone goes long, wouldn't it be overbought, and thus continuing going down?

what am i missing?

thanks.

The reason price wud fall in the first place is that there is no demand at that level, so price falls untill it reaches demand. Then Once Supply is eaten up price will rise.
Its an on going battle.
Yes u are sort of correct that supply wud run down as price goes lower, then u get the retracement untill it reaches fresh supply or demand make sense?
I wouldnt say that fibonachi is self fulfilling because so many people trade it, im a believer in that fibonachi exists in everything.
My own personal view is that fibonachi is just a tool to help determine price targets. The real force at work is supply and demand. As i said its a constant battle. Hope this helps