The twelfth century monk Leonardo de Pisa, better known to his friends as Fibonacci, discovered a fascinating mathematics sequence that appears throughout nature. Beginning with a simple 1 + 1, the sum of the last two number sets that precede it creates another Fibonacci value:
1+1=2 1+2=3 2+3=5 3+5=8 5+8=13 8+13=21 13+21=34 21+34=55 etc
These numbers possess an intriguing number ...
A formation of left shoulder forms a new high with a corrective dip, next rally forms higher high = head, correction from head goes below high of left shoulder and near as low of the left shoulder correction, breaching up trendline, rally of right shoulder does not breach head high, retracing half to three quarters of head correction.
The triangle formation can be quite difficult to analyse and the fact that a few different types of triangles exist doesn't make this task any easier. Furthermore a triangle is most commonly just a pause in a trend (continuation pattern) but can also terminate a trend (reversal formation).
The double bottom is the opposite of the double top is often called a 'W-top'. When the market is failing twice at a support and is reversing then sharply. A break of the resistance would indicate further rising towards the target that can be evaluated through the following procedure. The vertical width of the 'W' (price difference) is projected downwards ...
For obvious reasons the double top or reversal formation is often called an M-top. The market is failing twice at a resistance and is reversing then sharply. A break of the support would indicate further losses towards the target that can be evaluated through the following procedure. The vertical width of the 'M' (price difference) is projected downwards from the ...
When prices trend between two parallel trendlines they form a channel. When prices hit the bottom trendline this may be used as a buying area and when prices hit the upper trendline this may be used as a selling.
A trend is simply the overall direction prices are moving: up, down or flat.
Classification:
short term - less than 3 weeks
medium term - 3 weeks to 6 months
long term (major term) - more than 6 months
An up-trendline is a straight line passing through the rising troughs of an up-move. The importance of a trendline is increasing with every additional touching point, ...
A resistance is a term used in technical analysis indicating a specific price level at which a currency will have the inability to cross above. Recurring failure for the price to move above that point produces a pattern that can usually be shaped by a straight line. A resistance level penetrated becomes a support.
A support is a term used in technical analysis indicating a specific price level at which a currency will have the inability to cross below. Recurring failure for the price to move below that point produces a pattern that can usually be shaped by a straight line. A support level penetrated becomes a resistance.
