Practicality of Fibonacci Retracements

Discussion in 'Technical Analysis' started by Raul641, Mar 13, 2007.

Fibonacci retracements...

  1. Excellent! One of my favorite tools.

    40 vote(s)
  2. They're useful sometimes.

    38 vote(s)
  3. Tea Leaves!

    43 vote(s)
  4. What's a Fibonacci retracement?

    9 vote(s)
  1. Raul641


    The S&P open yesterday and today were both at the 38.2% retracement of its recent high to recent low. Today we got a huge selloff.

    Prices seem to reverse at Fibonacci retracement levels often enough to be interesting, but they also seem to ignore the Fibonacci levels often enough to make it impractical as a trading indicator.

    How do you all use the Fibonacci levels in your trading, if at all? Is it only as another confirmation for other indicators or theories?

  2. Raul, I have been studying this very subject for about 3 months now. An Excellent book that helped me is by Larry Pesavento
    Fibonacci Ratios with Pattern Recognition. It is 49.00 and worth much more. If you want to discuss this further you can PM me with your phone number and I will call you. I am looking for people to talk to about this because it helps me learn also.

    The fact that you noticed that the indexes could not penetrate the .382 retracement is telling you that the down trend is strong so far.
  3. Raul641


    The S&P couldn't penetrate the 38.2%, but it had no problem with 23.6%, which does not seem to have been a significant brake on price action at all. What does this mean?

    Thanks for the tip on the book, I'll look for it.
  4. gpgpgod


    I would also recommend adding Dianapoli Levels to this discussion.
    Its another way of confirmation to Fibo, I wonder if any of you are using it.
  7. Also, when the markets move past a previous swing high or low
    the next important Fibs are 1.27 and 1.618 for a possible reversal
  8. here is a .786 area that was hit today
  9. 779 may provide some resistance .382 but if we move above it we can trget .618 area 784.20
  10. tou can see from a 5min chart from today that 786 is providing resistance.....but you also have the influence of the other larger cycles in play also
    #10     Mar 14, 2007