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Use Fibbonacci to earn profit in Stock market

Sunday, October 24, 2010 | Labels: , , | |


When, I was studying Technical analysis. I had come through so many subjects.
One of my favorite topics is Fibonacci. It is only technique which
can be used without any graphical chart also. It can be used with less
cumbersome mathematics(If you are in market don't run away from math)

First me introduced you with Fibonacci, all those definition are choose from
various web and present here as per my interest

  • Introduction with Fibonacci

Indian Sanskrit grammarian, Pingala, is credited with the first mention
 of the sequence of numbers, between the fifth century B.C.
and the second or third century A.D. Since Fibonacci introduced the
series to Western civilization, it has had a high profile from time
to time. Recently, in The Da Vinci Code, for example, the Fibonacci
sequence is part of an important clue. Another application, the Fibonacci
poem , is a verse in which the progression of syllable numbers per line
follows Fibonacci's pattern. To read more

Fibonacci is amazing mathematical series.
A series of whole numbers in which each number is the sum of the
two preceding numbers. Beginning with 0 and 1, the sequence of Fibonacci
numbers would be 0,1,1, 2, 3, 5, 8, 13, 21, 34, etc. using the
formula n = n(-1) + n(-2), where the n(-1) means "the last number before n
in the series" and n(-2) refers to "the second last one before n in the
series." To read more

I think you can now familiar with what is Fibonacci, let's forget all those

Just keep in mind That Fibonacci is amazing mathematical series which can be
used for milking profit from market.

Fibonacci series no=0, 1, 1, 2, 3, 5, 8, 13, 21, 34, 55, 89, 144 just keep
adding last no. with previous one...

This series creates so many amazing thing in nature.
It is used for to predict rabbit reproduction, to predict seeds in sunflower.
One can easily know how many petals on flower.

  • How to use Fibonacci in Stock market?

Fibonacci series of no. and it's ratio can be used in Technical analysis,
no matter doesn’t know Elliot wave Technique.

There are  significant ratios. The ratio of 2 numbers in sequence
approaches 1.618 as the series progresses.
In stock market analysis, the percentages derived from the
Fibonacci sequence are 61.8%, 38.2% (100%-61.8%) and 50%. Those ratios are
important to us in stock market.

You can watch in above diagram How to use it in actual way.

In Nifty I like to share you one secret. If Nifty(spot) is stuck good amount
time between 0.38%-0.46% then current trend changes in 180 degree.
That means if it stuck on positive trend 0.38%-0.46%, then it will goes in
negative or if it stuck on negative trend 0.38%-0.46%, then it will goes in
positive. (It really works!!!) . Find use of this series for other stock and
report to us for our reader’s sake.

Precaution:-Keep it in mind. if you want to use it, then practice it your
You can study Fibonacci more deeply. If you are here till the end of this page that means that my
aim to introduced you one of the technique of technical analysis.

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