Fibonacci Retracements > > The most popular Fibonacci Retracements
are 61.8% and 38.2%. > Retracements can be applied after a decline
to forecast the length of a counter trend bounce.
These retracements can be combined
with other indicators and price patterns
to create an overall strategy. > Retracements are based on the prior move.
A bounce is expected to retrace a portion of the prior decline. > After a decline,
once a bounce begins,
chartists can identify specific Fibonacci retracement levels for monitoring. > Common Retracements
The Fibonacci Retracements Four common retracements: > 61.8%
> 23.6% The 50% retracement is not based on a Fibonacci number.
Instead, this number stems from Dow Theory's assertion that the Averages often retrace half their prior move. > The 61.8% retracement
can be referred to as the golden retracement. > The 38.2% -to- 50% retracement range
would be considered moderate. > A 23.6% retracement
is relatively shallow. http://stockcharts.com/school/doku.php?id=chart_school:chart_analysis:fibonacci_retracemen