A technical indicator is a series of data points that are derived by applying a formula to the price data of a security. Price data includes any combination of the open, high, low or close over a period of time. Some indicators may use only the closing prices, while others incorporate volume and open interest into their formulas. The price data is entered into the formula and a data point is produced.

2 Comments
  1. Naresh 5 years ago

    Hi,
    Fibonacci Series and Fibonacci retracement
    Fibonacci series is the sequence of numbers in which each number is the sum of the previous two numbers in the sequence. Fibonacci Series is 0, 1, 1, 2, 3, 5, 8, 13, 21, 34, 55, 89, 144,………….
    Golden Mean is 1.618 Logic behind golden mean is the ratio of two consecutive numbers in fibonacci series is same for all the two consecutive numbers.
    Example 1: 21/13=1.618 Example 2: 144/89=1.618

    Fibonacci Retracements are ratios used to identify potential reversal levels. The most popular Fibonacci Retracements ratios are 23.6%, 38.2% and 61.8%.
    These ratios are found using the Fibonacci sequence
    1. 61.8% – dividing one number in the series by the number that follows it. For example: 8/13 = 0.6153
    2. 38.2% – ratio is found by dividing one number in the series by the number that is found two places to the right.
    3. 23.6% ratio is found by dividing one number in the series by the number that is three places to the right.

    Fibonacci Retracements used to identify support and resistance zones during the correction of the trend

    In bullish retracement
    Use the Fibonacci retracement tool to connect the trends bottom & top, by doing this Fibonacci retracement levels will be plotted in the chart.
    When the price retraces from the peak then fibonacci retracement levels will act as a support zone.

    Follow the below instruction in which you can easily find these Fibonacci retracement levels,
    First, find the recent significant Swing Highs and Swings Lows.
    For downtrends, click on the Swing High and drag the cursor to the most recent Swing Low.
    While for uptrends, do the opposite. Click on the Swing Low and drag the cursor to the most recent Swing High.
    When you applying the tool, the software shows you the retracement levels automatically.
    (Fibonacci retracement tool is available in eqsis chart, find and use it)

  2. Author
    Teresa David 5 years ago

    Hi Naresh,

    Thank you for your reply with examples.

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