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Tagged: Fibonacci series, Golden mean
fibonacci series is 0,1,1,2,3,5,8,13,21,34,55,89….244 it is a mathematical theory and it is a calculated by adding the previous two number and it is a infinity .
This ratio was found by Fibonacci which is found as follows.
Fibonacci Series: 0 and 1 is the original number and adding the latter with the former in the sequence will a series of numbers. 0,1,1,2,3,5,8,13 and so on.
It is interested to note that starting from 6th number in the series, a ration formed between higher and immediate lower number will result in 1.6xx and this value becomes constant (1.618) through out the series with higher order numbers.
Eg: 13/8 = 1.6xx, 89/55 = 1.618
Fibonacci series is the sequence of numbers where the number are added with previous number.
0 1 1 2 3 5 8…
<span class=”_Tgc”>The <b>Fibonacci Sequence</b> is the <b>series</b> of <b>numbers</b>: 0, 1, 1, 2, 3, 5, 8, 13, 21, 34, … The next <b>number</b> is found by adding up the two <b>numbers</b> before it and goes up to Infinity. 3 is found by adding the two <b>numbers</b> before it (1+2), 21 is found by adding the two <b>numbers</b> before it (13+8)</span>
The mathematical miracle of the series is we get approximately 1.618 called GOLDEN MEAN or Golden Ratio when one number in the series is divided by the previous number in the series starting from 3. EX 5/3 = 1.666, 89/55 = 1.618 or 144/89 = 1.617 etc.
<span style=”text-decoration: underline;”>One Comment</span> In what way we can use this Fibonacci series and Golden mean for stock trading technical analysis is not clear to me.
Thanks for Researching About Fibonacci series and Golden mean.
This can be used to understand the retracement level.
For Eg, If a stock rally from 300 to 350 levels – which is 50 points positive movement may have a set back of 61.8% of 50 = 30.6, Hence We can expect the stock to take support at 321 levels
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