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Fibonacci!

By Johns Wu on Jan 10, 2006

OH MAN. I discovered the power of the fibonacci retracement and fibonacci extension tonight. Seriously, it really works on stocks that are traded primarily by pros (small caps). I was testing it out and i was amazed at how accurately the fibonacci levels served as supports and resistances. I'll be exploring this tool more in the days to come, and I'll be applying it to my chart analysis from now on. Seriously it works!!! Crazy mathmaticians.

UPDATE: Here's an example of a fibonacci retracement on GROW.

I guess it could be simple coincidental that fibonacci retracements coincide with supports, but I'll continue to try to apply fibonacci techniques to other charts.

Does anyone have a free program that does fibonacci extensions?

UPDATE 2: Another fibonacci retracement on PETS.

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This entry was posted on Tuesday, January 10th, 2006 at 3:39 am and is filed under Market News. You can skip to the end and leave a response. Pinging is currently not allowed.


7 Responses to “Fibonacci!”


By Hakan Aydin on January 10th, 2006 at 10:18 am

Hi,

Can you give an example? Maybe with a chart. I spent a couple weeks on fibonacci retracements in the past year, but my conclusion was that the supports and resistances are coincidental for some stocks. I’d be interested if you can provide a good example.

Thanks,
Hakan
http://www.aydin.net/blog

By TRADER on January 10th, 2006 at 11:37 am

hey bull

check ANGN
maybe a chart here
major breakout today
check 5 yr chart
looks nice

By Space4u2go on January 10th, 2006 at 5:35 pm

For those who want the proof if Fibonacci retracement really works then check out following stocks:

1. QQQQ – Last oct/Nov timeframe when the market reversed, the market retraced to 61.8%

2. YHOO – Last Sept/Oct timeframe, the stock reversed, and retraced to 61.8%

Usually in strong trending markets the retracement is 38.2% while in slow trending markets it is 61.8%, although 50% also acts as retracement level at times.

By downtowntrader on January 10th, 2006 at 7:16 pm

I use fibonacci retracements, fans, and extensions pretty frequently. Check out http://www.mglider.com for a program that has a lot of fib. tools. Also, I use medved’s quotetracker for intraday charts and they have fibonacci tools as well. Here is a link to a post I did on fibonacci fans.

http://downtowntrader.blogspot.com/2005/12/fibonacci-fans.html

Also, I think it is more accurate in high volume stocks. I ballpark it on thinly traded small caps. For example look at this one on MCX. The 61.8% was pretty close, but not exactly the bottom of the retracement.

http://stockcharts.com/def/servlet/SC.web?c=MCX,uuw,adaclyyaydcpb10!b20!b50!b200!i!fvc60iut!ub14!la12,26,9!lc20!ld20!lh14,3J65091155,Y&listNum=4

This one was much more exact.

http://stockcharts.com/def/servlet/SC.web?c=mmus,uur,adaclyyaydcpb10!b20!b50!b200!i!fvc60iut!ub14!la12,26,9!lh14,3!lc20J66044271,Y&pref=G

Good Luck with you newly found toy. Shoot me an email if you ever want to discuss anything.

DT

By Technicator.NET on January 10th, 2006 at 7:27 pm

I agree. I’ve been familiar with them and that’s one of the tools I used to predict how far QQQQ would retrace before shooting up lately. It’s interesting, many things in this universe follow the ratios.

By Anonymous on June 23rd, 2006 at 4:55 pm

Fibs work great in retrospect, but not in predicting future events. Much easier to find the true high and low once they have already happened and are distant in the past :-P

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