01/05/2011 - How To Use Fibonacci Ratios in the Real World
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How To Use Fibonacci Ratios in the Real World
A free Club EWI report teaches the basics of Fibonacci analysis of commodities and other markets
April 27, 2011
By Elliott Wave International
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This article was syndicated by Elliott Wave International and was originally published under the headline How To Use Fibonacci Ratios in the Real World. EWI is the world's largest market forecasting firm. Its staff of full-time analysts led by Chartered Market Technician Robert Prechter provides 24-hour-a-day market analysis to institutional and private investors around the world.
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Consider Fibonacci ratios: Mathematical proportions by which moves on a market chart relate to each other. Fibonacci mathematics is an integral part of Elliott wave analysis; Frost & Prechter's classic "Elliott Wave Principle -- Key to Market Behavior" has an entire chapter on it.
And here's an excerpt from a free Club EWI report on the subject. Enjoy -- and for details on how to read the entire report free, look below.
How To Apply Fibonacci Math to Real-World Trading
(excerpt; full
copy here)
By Jeffrey Kennedy
EWI Senior Tutorial Instructor
EWI Senior Commodity Analyst
It’s hard to imagine a wrong way to apply Fibonacci ratios or multiples to financial markets, and new ways are being tested every day. Let’s look at just some of the ways that I apply Fibonacci math in my own analysis. ...
Elliotticians often calculate Fibonacci extensions to project the length of Elliott waves. For example, third waves are most commonly a 1.618 Fibonacci multiple of wave one, and waves C and A of corrective wave patterns often reach equality (Figures 7-3 and 7-4).
One approach I like and have used for a number of years is a “reverse Fibonacci” application... (Continue reading this free report now with a free Club EWI password.)
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