IDENTIFYING POSSIBLES REVERSAL USING FIBONACCI
We will be eliminating Fibs while price maintain descending eliminating clusters zones as possible reversals,
For those who are not already familiar with the name Fibonacci, you may
remember hearing something about it in 2006, when the movie The DaVinci
Code appeared in theatres. When Jacques Saunière was found murdered
at the Louvre Museum in Paris, the strange position that this deceased
character was placed in mimicked the famous painting of the Vitruvian
Man by Leonardo da Vinci. This painting has been known to illustrate how
Fibonacci ratios appear in the human form. The film also piqued the
curiosity of some people when the characters in the film started talking
about Fibonacci numbers as part of a clue or code of some sort.
The Fibonacci number series and the properties of this series were
made famous by the Italian mathematician Leonardo de Pisa.
Fibonacci price retracements are run from a prior low-to-high swing using
the ratios 0.382, 0.50, 0.618, and 0.786
Extensions are run from prior low-to-high swings using the ratios 1.272
and 1.618 for potential support. They are run from prior high-to-low swings
using the ratios 1.272 and 1.618 for potential resistance.
Price cluster is the coincidence of at least three
Fibonacci price relationships that come together within a relatively tight
range. These price clusters identify key support and resistance zones that
can be considered to be trade setups. A price cluster can be created from
three retracements, three extensions, three projections, or the combination
of any of these price relationships.
Symmetry using the price projection tool with
the 1.0 setting. (This is sometimes called an extension tool on many other
analysis programs.) With projections, we are comparing swings in the
same direction by using this tool, which allows you to choose three price
points to make the projection.
I use symmetry most often to project possible support or resistance
in order to help me enter a trade in the direction of the trend.
I project 100 percent of the prior corrective swings to help identify areas to
enter the market in the direction of the trend.
swings is the countertrend or shorter-term declines within a larger uptrend,
or the countertrend or shorter-term rallies within a larger downtrend.
For those who are not already familiar with the name Fibonacci, you may
remember hearing something about it in 2006, when the movie The DaVinci
Code appeared in theatres. When Jacques Saunière was found murdered
at the Louvre Museum in Paris, the strange position that this deceased
character was placed in mimicked the famous painting of the Vitruvian
Man by Leonardo da Vinci. This painting has been known to illustrate how
Fibonacci ratios appear in the human form. The film also piqued the
curiosity of some people when the characters in the film started talking
about Fibonacci numbers as part of a clue or code of some sort.
The Fibonacci number series and the properties of this series were
made famous by the Italian mathematician Leonardo de Pisa.
Fibonacci price retracements are run from a prior low-to-high swing using
the ratios 0.382, 0.50, 0.618, and 0.786
Extensions are run from prior low-to-high swings using the ratios 1.272
and 1.618 for potential support. They are run from prior high-to-low swings
using the ratios 1.272 and 1.618 for potential resistance.
Price cluster is the coincidence of at least three
Fibonacci price relationships that come together within a relatively tight
range. These price clusters identify key support and resistance zones that
can be considered to be trade setups. A price cluster can be created from
three retracements, three extensions, three projections, or the combination
of any of these price relationships.
Symmetry using the price projection tool with
the 1.0 setting. (This is sometimes called an extension tool on many other
analysis programs.) With projections, we are comparing swings in the
same direction by using this tool, which allows you to choose three price
points to make the projection.
I use symmetry most often to project possible support or resistance
in order to help me enter a trade in the direction of the trend.
I project 100 percent of the prior corrective swings to help identify areas to
enter the market in the direction of the trend.
swings is the countertrend or shorter-term declines within a larger uptrend,
or the countertrend or shorter-term rallies within a larger downtrend.
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