Upcoming SlideShare
×

# FOREX - TECHNICAL ANALYSIS: FIBONACCI (4.2)

1,613 views

Published on

Fibonacci analysis is the study of identifying potential support and resistance levels in the future based on past price trends and reversals. Fibonacci analysis is based on the mathematical discoveries of Leonardo Pisano—also known as Fibonacci. He is credited with discovering a sequence of numbers that now bears his name: the Fibonacci sequence.

Published in: Economy & Finance
4 Likes
Statistics
Notes
• Full Name
Comment goes here.

Are you sure you want to Yes No
• Be the first to comment

Views
Total views
1,613
On SlideShare
0
From Embeds
0
Number of Embeds
2
Actions
Shares
0
112
0
Likes
4
Embeds 0
No embeds

No notes for slide

### FOREX - TECHNICAL ANALYSIS: FIBONACCI (4.2)

1. 1. 1Chapter 4.2Technical Analysis: Fibonacci 0
2. 2. preceding number. For example, 89 is 1.618 times larger than 55 (89 ÷TECHNICAL ANALYSIS: FIBONACCI 55 = 1.618).Fibonacci analysis is the study of identifying potential support andresistance levels in the future based on past price trends and reversals. The golden ratio and the other ratios that exist within the FibonacciFibonacci analysis is based on the mathematical discoveries of Leonardo sequence represent the natural ebb and flow of life. They also apply toPisano—also known as Fibonacci. He is credited with discovering a the natural ebb and flow of the forex market.sequence of numbers that now bears his name: the Fibonaccisequence. In this section, you will learn how Fibonacci ratios can be applied to the forex market using the following analysis tools:The Fibonacci sequence is a series of numbers that progresses asfollows, 0, 1, 1, 2, 3, 5, 8, 13, 21, 34, 55…. To arrive at eachsubsequent number in the sequence, you simply sum the two Fibonacci retracementspreceding numbers in the sequence. For example, to find the number Contentsthat follows 55 in the sequence, you add 55 + 34 (the two preceding Fibonacci projectionsnumbers in the sequence). The sum of 55 + 34 is 89. This is the nextnumber in the sequence. Fibonacci fansWhat intrigued Fibonacci about this sequence was not the numbersthemselves but rather the relationships among the numbers, or theratios created by various numbers in the sequence. Perhaps the mostimportant ratio is 1.618—also known as the golden ratio, or goldenmean. This number can be found throughout nature (in sea shells,growth rings, etc.) and throughout the Fibonacci sequence. Eachnumber in the Fibonacci sequence is 1.618 times larger than the 1