The Frontiers Of Trading

by: Ivan Cavric Fibonacci retracement is a popular technical analysis tool that uses horizontal lines to indicate areas of support or resistance at the key Fibonacci levels before the price continues in the original direction. These levels are derived from the Fibonacci sequence and are commonly used in conjunction with trend lines to find entry and exit points in the market. The Fibonacci sequence is a series of numbers in which each number is the sum of the two preceding numbers, starting with 0 and 1. The key Fibonacci levels derived from this sequence are 23.6%, 38.2%, 50%, 61.8%, and 100%. To use Fibonacci retracement, you need to first identify the direction of the trend. This can be done using trend lines, moving averages, or other technical indicators. Once you have identified the trend, you can then draw a Fibonacci retracement from the high to the low of the trend. The horizontal lines at the key Fibonacci levels will then act as potential areas of support or resistance. For...

By:  Ivan Cavric Fibonacci, Actually named Leonardo of Pisa , was born in Pisa, Italy about 1175 A.D.. Today, he is recognized as the greatest European mathematician of the middle ages. Fibonacci is credited with introducing the Arabic-Hindu numeral system to Europe. He also introduced the decimal system. Both became the basis of mathematics we use today. Enough background for now. Although Fibonacci covered an entire realm of mathematics, the main numbers used in trading are actually percentages. The percentages are 38.2%, 50%, and 61.8%. These areas are viewed as trend retracement points. The most commonly held theory is that a 38.2% retracement of a trend is a failed reversal and the overall trend should continue. A retracement to the 61.8% mark signals that the retracement is the beginning of a new trend. The 50% level is used for different strategies if confirmed by several other signals The use of Fibonacci numbers in trading has become increasingly popular in recent years. ...