How Fibonacci Analysis Can

Help Improve Your Forex Trading

FIBONACCI NUMBERS EXPLAINED

• Centuries ago, a mathematician named Leonardo Fibonacci, introduced an interesting relationship between numbers.

• He introduced a number sequence, which starts with zero and one (0, 1). then to each number he adds the previous one which results in the following sequence...

FIBONACCI NUMBERS

• 0, 1, 1, 2, 3, 5, 8, 13, 21, 34, 55, 89, 144, 233, 377, 610, 987, 1597, 2584, 4181, 6765,10946……and so on and so on.

• Notice that each number of this number succession is formed by the sum of the previous two.

FIBONACCI RELATIONSHIPS

• Fibonacci discovered an

interesting relation between

the numbers in his sequence.

FIBONACCI RELATIONSHIPS

• He realized that each number is 61.8% of the next number in the set.

• Each number in the set is 38.2% of the number two positions to the right in the sequence.

• Every number in the set is equal to 23.6% of the number which is three positions to the right of it.

The 61.8% and the 38.2% ratios are all around us in the

physical universe. You find these values all over the

natural world – in plants, in animals, in space, in music, in

fingerprints, and even in human faces!cc: noaha - https://www.flickr.com/photos/69919530@N00

Since people constantly see Fibonacci ratios

subconsciously, human nature has been

adapted to perceive this as a harmonic ratio.cc: avrene - https://www.flickr.com/photos/23212428@N00

FIBONACCI RETRACEMENTS

• This is the most famous Fibonacci tool and is available on nearly every Forex trading platform.

• When you apply the Fibonacci Retracement instrument on the chart you will get horizontal lines, which indicate the levels 0.00, 23.6, 38.2, 50.0, 61.8, and 100.

FIBONACCI FAN• The Fibonacci Fan will extend three

diagonal lines, which vertically are distanced with 38.2%, 50.0% and 61.8% from the top or bottom of the trend.

• After we place our Fibonacci Fan on the chart, we observe the way the price reacts to the diagonal Fibonacci levels.

Check Out the “IN DEPTH”

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