This is probably one of the dumbest questions you could be asked, Kool so I apologize ahead of time. Is there anyway to know when price action reaches the 161 or 261 and you get a "reaction", whether it is just a short-lived retracement before a resumption of the main trend, or whether its the beginning of a new trend in the opposite direction?

Something I have noted. When a bar closes above the 1.618 projection and it pulls back if crosses back above the 1.618 it usually runs up to the 2.618.

correct DOESONE ..We have noted that before... also be aware that when a 2.618 is hit a a reaction occurs , it generally travels back to the 1.618! (unless there is a sizable overshoot or undershoot)