The document discusses Fibonacci analysis, a technical analysis tool that uses key Fibonacci ratios to identify potential support and resistance levels in financial markets. It notes that Fibonacci ratios of 0.382, 0.5, 0.618, 0.786, 1.27, 1.618, and 2.618 provide important support and resistance levels. Retracements of 38.2%, 50%, 61.8%, and 78.6% are watched as potential reversal levels. Extensions can then be used to project price targets in the direction of the trend. An example is given showing a pullback finding support at the 38.2% retracement before continuing upward to hit the 161.8% extension target.

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Fibonacci Analysis
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consultation with a financial advisor before investing.
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information in this presentation will result in profits. The content in this
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purposes and not intended as trading recommendation.
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Introduction
• Fibonacci analysis is a very powerful technical analysis tool. It can be
used independently or in combination with other technical indicators.
• Fibonacci Series consists of the following numbers: 1,1,2,3,5,8,13,21,
…
• Fibonacci numbers exhibit important relations with each other
o Dividing one number by the next = 0.618
o Dividing a number by the previous = 1.618
o Square root of 0.618 = 0.786
o Square root of 1.618 = 1.27
o Dividing a number by second number after it = 0.382
• The important Fibonacci levels are: 0.382, 0.5, 0.618, 0.786, 1.27,
1.618, 2.618
• These ratios provide important support and resistance level

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Fibonacci Retracements
• Markets retracements in uptrends or downtrends generally find
support or resistance at Fibonacci levels.
• Levels to watch are 38.2%, 50%, 61.8% and 78.6%
retracements of the move.
• A move above the 78.6% retracement indicates trend reversal.
• Trading Strategy
o Use candlestick reversal patterns to initiate buy or sell at
Fibonacci Levels.
o Place stops according to the guidelines of the pattern
o Use the following as guides for targets
 A 38.2% retracement gives a 1.618% projection
 A 61.8% retracement goes to a 1.382% projection, etc

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Fibonacci Extensions
• Fibonacci Extensions provide price targets in an uptrend or
downtrend after a reversal at a swing high and test of a
Fibonacci retracement level.
• The Fibonacci extension levels are obtained by adding the
length of the move in the direction of the move (100% level).
• The standard Fibonacci extension levels are 138.2%, 150%,
161.8%, 231.8%, 261.8%, 361.8% and 423.6%.

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Example
• The pair came back to the
38.2% retracement before
moving up.
• The 38.2% retracement gives
a 161.8% projection for the
target.
• The target projection is
measured from the low of the
pullback.
• The price topped our at the
161.8% extension before
moving lower.

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