Leonardo Fibonacci was an Italian mathematician born in the 12th century. He is known to have discovered the "Fibonacci numbers," which are a sequence of numbers where each successive number is the sum of the two previous numbers.
e.g. 1, 1, 2, 3, 5, 8, 13, 21, 34, 55, 89, 144, etc.
The quotient of the adjacent terms in the series possesses an amazing proportion, roughly 1.618, or its inverse 0.618. This proportion is known by many names: the golden ratio, the golden mean, PHI, and the divine proportion. The dimensional properties that adhere to the ratio of 1.618 occur repeatedly in nature.
When used in technical analysis, the golden ratio is typically translated into three percentages: – 38.2%, 50%, and 61.8%. However, more multiples can be used when needed, such as 23.6%, 161.8%, 423%, and so on. There are four primary methods for applying the Fibonacci sequence to finance: retracements, arcs, fans, and time zones.
Fibonacci retracements use horizontal lines to indicate areas of support or resistance. They are calculated by first locating the high and low of the chart. Then five lines are drawn: the first at 100% (the high on the chart), the second at 61.8%, the third at 50%, the fourth at 38.2%, and the last one at 0% (the low on the chart). After a significant price movement up or down, the new support and resistance levels are often at or near these lines.
Traders caught at the crossroads of traditional, proven, trading techniques - and new online tools and methods - have struggled to find a way of blending the two together into a unified trading system. Now, the marriage of the methods is complete, and brought into sharp focus in New Frontiers in Fibonacci Trading. This groundbreaking new work combines the foundations of Fibonacci trading with classic charting techniques, modern applications, and cutting edge online analysis tools.
Author Michael Jardine is a dedicate student of the markets, and active trader and founder of Enthios.com - a free web site offering an open exchange of trading ideas and a wealth of technical trading tools which he's made accessible to all investors. His years in the trading trenches - and the feedback he gets regularly from his Enthios.com trading community - has taught him the most practical ways to apply time-tested methods to an ever-changing market.
Michael has gone beyond his role as "student" of the markets - becoming a gifted teacher in the process. He has not only mastered traditional charting and timing techniques - he's developed new methods of his own by adopting Fibonacci fundamentals to the online trading arena in which today's trader must operate for maximum advantage. He's broken down his process into an understandable 5-part "system" which encompasses…
- The Building Blocks of Price Action - market structures, retracement patterns and Fibonacci basics
- Practical Fibonacci Applications - featuring original new applications explained in simple terms
- "ChartWorks" - a comprehensive charting section featuring indicators, case-study trades, chart-reading tips - and more
- Building Good Trading Habits - 3 key steps for making rational, unemotional decisions and maintaining a steady, clear-headed focus throughout the trading day - even when the market is giving off mixed messages
- Enthios RealTime - Puts all the pieces together, and introduces new methods that form the core of his own propriety "Objective Method Trading System"
In layman's terms, providing the guidance of a thoughtful, patient teacher, Michael presents concepts you can easily implement. Including:
- How to enter and exit a trade with limited risk
- New and original Fibonacci methods that have evolved with the advent of online, real-time trading
- Jardine's 3 Laws of Successful Trading
- How to execute a trade when the signals are mixed or conflicting - rather than under "model" conditions
- Developing a system that does not require you to predict how the market will perform - or worry about when the breakout will occur.
With detailed charts and graphics throughout, each chapter illustrates real trading situations, setups, and solutions. Michael has fused cherished trading concepts and Fibonacci basics with his own experiences in online, real-time trading. The result is a thorough new primer that shows you how to trade with greater success - on a consistent basis.
A fresh look at classic principles and applications of Fibonacci numbers and the Elliott Wave trading system. Demonstrates how to calculate and predict key turning points in commodity markets, analyze business and economic cycles as well as identify profitable turning points in interest rate movement. Forty charts and tables show how to use this analysis on a daily, weekly or intra-day trading basis.
With his bestselling Fibonacci Applications and Strategies for Traders, Robert Fischer established himself as the leader in the Fibonacci approach to trading. Moving beyond the old Fibonacci trader, who had the ideas, rules, and tools on paper, Fischer, with son Jens Fischer, now use computer graphics and calculation technology along with new Fibonacci tools to successfully trade the markets in The New Fibonacci Trader.
In trading the markets it’s important to know what to buy, but it’s even more important to know when to buy. Accurately measuring price and time signals are one of the best ways you can do this. Now, this groundbreaking book and CD-ROM provide a powerful new arsenal of Fibonacci trading tools and software–WINPHI–to recognize patterns, predict swings, and buck the trend–so you can achieve the highest rate of profitable trades.
A quick recap of the core principles of Elliott Wave Theory and Fibonacci Ratio are discussed to present an overall framework for The New Fibonacci Trader. From here, Fibonacci expert Robert Fischer gets to the heart of the concept by examining six geometrical Fibonacci trading tools:
Fibonacci Summation Series: to capture the rhythm of annual market swings
Corrections and extensions: trading with and against the main trend
PHI-channels: as indicators for market trend changes
PHI-ellipses: to identify underlying structures of price moves
PHI-spirals: to identify trend reversals in the market
Fibonacci time goal analysis: that use the ratios 0.618, 1.000, and 1.618 to anticipate the exact day, in time and price, a trend will change direction.
Along with helpful charts and graphs, The New Fibonacci Trader shows you how to effectively apply Fibonacci trading tools by using state-of-the-art WINPHI software, which is included in the companion CD-ROM.
Used individually or in concert, Fibonacci trading/analysis tools can provide the foundation for sophisticated trading strategies. These concepts are valid for volatile and marketable individual stocks worldwide, and are not just limited to the trading environment of the United States. In both bull and bear market conditions, these concepts work equally well. Many of the tools outlined can be applied to monthly, weekly, daily, or even intraday charts.
Whether you’re dealing in stocks, futures, or cash currencies, The New Fibonacci Trader will help you calculate key turning points in the markets, analyze market cycles, and make disciplined trading possible and profitable.
Most readers will have at least dim memories from geometry class of the irrational number pi. Theoretical astrophysicist Livio gives pi's overlooked cousin phi its due with this lively account, the first on the subject written for the layperson. Phi is the golden ratio of antiquity (1.6180339887), a never-ending number so lauded for its harmonious qualities that in the 16th century it was dubbed the divine proportion. It is related to phenomena as diverse as the petal arrangements of roses, the breeding patterns of rabbits and the shape of our galaxy. Phi is also claimed to have been crucial in the design of the Great Pyramids, the composition of the Mona Lisa and the construction of Stradivarius violins. Livio (The Accelerating Universe) carefully investigates these and other claims and does not hesitate to debunk myths perpetuated by overzealous enthusiasts he calls "Golden Numberists." This is an engaging history of mathematics as well, addressing such perennial questions as the geometric basis of aesthetic pleasure and the nature of mathematical objects. Useful diagrams and handsome illustrations of works under discussion are amply provided. Livio is gifted with an accessible, entertaining style: one typical chapter bounds within five pages from an extended discourse on prime numbers to a clever Oscar Wilde quote about beauty to an amusing anecdote about Samuel Beckett and finally to an eminently clear explanation of G"del's incompleteness theorem. With a guide to the history of ideas as impassioned as Livio, even the math-phobic can experience the shock and pleasure of scientific discovery. This thoroughly enjoyable work vividly demonstrates to the general reader that, as Galileo put it, the universe is, indeed, written in the language of mathematics.
