Therefore, the Fibonacci sequence should apply to the financial markets. There are many Fibonacci tools used by traders, they include:
Monday, July 26, 2010
Technical Indicators - Fibonacci
Fibonacci tools utilize special ratios that naturally occur in nature to help predict points of support or resistance. Fibonacci numbers are 1, 1, 2, 3, 5, 8, 13, 21, 34, 55, 89, etc. The sequence occurs by adding the previous two numbers (i.e. 1+1=2, 2+3=5) The main ratio used is .618, this is found by dividing one Fibonacci number into the next in sequence Fibonacci number (55/89=0.618). The logic most often used by Fibonacci based traders is that since Fibonacci numbers occur in nature and the stock, futures, and currency markets are creations of nature - humans.
Therefore, the Fibonacci sequence should apply to the financial markets. There are many Fibonacci tools used by traders, they include:
Therefore, the Fibonacci sequence should apply to the financial markets. There are many Fibonacci tools used by traders, they include: