Differences

This shows you the differences between two versions of the page.

--- chart_analysis:fibonacci_time_zones [2019/06/24 19:38]
127.0.0.1 external edit
+++ chart_analysis:fibonacci_time_zones [2023/09/15 23:07] (current)
jayanthi [SharpCharts]
@@ Line 1: / Line 1: @@
 ====== Fibonacci Time Zones ======
-===== Introduction =====
+===== What Are Fibonacci Time Zones? =====
-Fibonacci Time Zones are vertical lines based on the Fibonacci Sequence. These lines extend along the X axis (date axis) as a mechanism to forecast reversals based on elapsed time. A major low or high is often chosen as the starting point. Distances start relatively small and grow as the Fibonacci Sequence extends. Chartists can extend the Fibonacci Time Zones into the future to anticipate potential reversal points.
+Fibonacci Time Zones are a technical analysis tool designed to identify potential areas of price reversal using the Fibonacci sequence. The tool draws vertical lines to the right at each Fibonacci ratio, most commonly 23.6%, 38.2%, 50%, 61.8%, and 78.6%, based on significant swing highs and lows.
-===== The Sequence and Ratios =====
+These lines extend along the date axis, marking expected intervals where reversals might occur based on the time that has passed. While the starting point often comes from a major low or high, the distances between these zones start relatively small and grow in accordance with the Fibonacci Sequence. Though not always pinpoint accurate, Fibonacci Time Zones are a valuable forecasting tool for anticipating potential price reversal points.
+===== How Do the Sequence and Ratios Work? =====
 This article is not designed to delve too deep into the mathematical properties behind the Fibonacci sequence and Golden Ratio. There are plenty of other sources for this detail. A few basics, however, will provide the necessary background for the most popular numbers. Leonardo Pisano Bogollo (1170-1250), an Italian mathematician from Pisa, is credited with introducing the Fibonacci sequence to the West. It is as follows:
@@ Line 21: / Line 24: @@
 //....the proportion of .618034 to 1 is the mathematical basis for the shape of playing cards and the Parthenon, sunflowers and snail shells, Greek vases and the spiral galaxies of outer space. The Greeks based much of their art and architecture upon this proportion. They called it the golden mean.//
-===== Interpretation =====
+===== How Do You Interpret Fibonacci Time Zones? =====
-The slow start in the Fibonacci sequence creates relatively tight clustering at the beginning of the Fibonacci Time Zones. Sometimes, it is necessary to ignore the first 5 or so time zones as, after that point, the zones expand quite quickly as the sequence unfolds. According to the theory, potential reversal points can be found by looking ahead 21, 34, 55, 89 and 144 days, all of which are Fibonacci numbers. 21 days marks the 8th Fibonacci Time Zone. Some subsequent zones are listed below. **Remember, you can find future times zones by adding the previous two time zones** (89 + 144 = 233).
+The slow start in the Fibonacci sequence creates relatively tight clustering at the beginning of the Fibonacci Time Zones. Sometimes, it is necessary to ignore the first five or so time zones as, after that point, the zones expand quite quickly as the sequence unfolds. According to the theory, potential reversal points can be found by looking ahead 21, 34, 55, 89, and 144 days, all of which are Fibonacci numbers. 21 days mark the 8th Fibonacci Time Zone. Some subsequent zones are listed below. **Remember, you can find future time zones by adding the previous two time zones** (89 + 144 = 233).
   * 8th zone = 21 days or periods
@@ Line 32: / Line 35: @@
   * 13th zone = 233 days or periods
-{{:chart_analysis:fibonacci_time_zones:ftz-1-qqqqexam.png|Chart 1 - Fibonacci Time Zones}}
+{{:chart_analysis:fibonacci_time_zones:ftz-1-qqqqexam.png|Fibonacci Time Zones using StockCharts.com}}
 ===== QQQQ Example =====
@@ Line 55: / Line 58: @@
 {{:chart_analysis:fibonacci_time_zones:ftz-5-fxefut.png|Chart 5 - Fibonacci Time Zones}}
-===== Conclusion =====
+===== The Bottom Line =====
-Fibonacci Time Zones are called "zones" for a reason. They are not hard reversal points, but rather //potential// reversal points to watch as prices approach this zone. Fibonacci Time Zones provide a cross between cycle analysis and Fibonacci analysis. Both have a wide following and turning points can be forecast weeks and months in advance. However, these forecast points serve as alerts for potential trend reversals. As these reversal points approach, chartists should turn to other aspects of technical analysis to actually confirm the reversal. This could be a bullish or bearish pattern, bullish or bearish candlesticks, bullish or bearish indicators or clues from the price chart itself.
+Fibonacci Time Zones are called "zones" for a reason. They are not hard reversal points but//potential// reversal points to watch as prices approach this zone. Fibonacci Time Zones provide a cross between cycle analysis and Fibonacci analysis. Both have a wide following, and turning points can be forecast weeks and months in advance. However, these forecast points serve as alerts for potential trend reversals. As these reversal points approach, chartists should turn to other aspects of technical analysis to confirm the reversal. This could be a bullish or bearish pattern, bullish or bearish candlesticks, bullish or bearish indicators or clues from the price chart itself.
 ===== SharpCharts =====
-You can use our [[docs>chartnotes|ChartNotes annotation tool]] to add Fibonacci Time Zones to your charts. Below, you'll find an example of a chart annotated with Fibonacci Time Zones.
+To add Fibonacci Time Zones to your charts, you can use our [[https://support.stockcharts.com/doku.php?id=chartnotes|ChartNotes annotation tool]]. Below, you'll find an example of a chart annotated with Fibonacci Time Zones.
 {{:chart_analysis:fibonacci_time_zones:ftz-7-shch.png|Chart 6 - Fibonacci Time Zones}}
-To learn more about how to add this annotation to your charts, check out our Support Center article on [[docs>chartnotes:line_studies#fibonacci_time_zones|ChartNotes' Line Study Tools]].
+To learn more about how to add this annotation to your charts, check out our Support Center article on [[https://support.stockcharts.com/doku.php?id=chartnotes:line_studies#fibonacci_time_zones|ChartNotes' Line Study Tools]].
+===== Fibonacci Time Zones =====
+==== Which Fibonacci ratios are most commonly used for these time zones? ====
+The most common ratios are 23.6%, 38.2%, 50%, 61.8%, and 78.6%.
+==== How do Fibonacci Time Zones help in trading? ====
+They mark expected intervals where price reversals might occur, offering traders potential entry or exit points.
+==== Can you provide a brief about the Fibonacci sequence? ====
+Starting from 0 and 1, each subsequent number is the sum of the two preceding numbers (e.g., 0, 1, 1, 2, 3, 5, 8...).
+==== How accurate are Fibonacci Time Zones? ====
+While they offer valuable insights, they aren't always pinpoint accurate. They serve as potential indicators rather than certainties.
+==== Do Fibonacci Time Zones provide definite reversal points? ====
+No, they are zones indicating potential reversals. Other technical analysis aspects should be used in conjunction to confirm reversals.