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chart_analysis:fibonacci_time_zones [2019/09/07 00:06] betseyp [SharpCharts] |
chart_analysis:fibonacci_time_zones [2023/09/15 23:03] jayanthi [The Sequence and Ratios] |
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| ====== Fibonacci Time Zones ====== | ====== 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. |
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| + | ===== 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: | 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: | ||