**square circle and triangle**
From a circle, square and triangle if you play around a little you get the following numbers:-
1.414 (sqr2)
1.618 (phi or the fib number)
1.272 (sqr phi)
and their inverses
0.618
0.707
0.786
These together with 0.5 (1/2) and 0.382 (1-0.618) do seem to recur a large amount in the mkts esp if one allows a few percent tolerance either way.
Reading the economist this week (page 89) they quote a study which disproves the validity of fib numbers for market trading but again how are these studies done?)
Personally suspect that success has far more to do with psychology (sticking with your trading plan and not taking emotional decisions) and this is very hard.
I'm studying using fib ratios per above based around certain patterns to give an "edge", but fully believe that I and others using this will only suceed if we get the application right
cheers
P |