Fibonacci ratios are excellent tools for Forex trading, and in this guide we will make clear what most traders find complicated.
First, let's try to understand what Fibonacci ratios are. Fibonacci numbers are named after the Italian mathematician that found them. Each Fibonacci number consists of the summation of the previous two numbers. These numbers are: 1, 1, 2, 3, 5, 8, 13, 21, 34, 55, 89, 144, etc… This way 3=2+1, 5=3+2 and so on.
Not including the first few Fibonacci numbers, the ratio of a Fibonacci number to the following one is always 0.618. For example, 89/144=0.618. The ratio between two alternate Fibonacci numbers is 0.382. These ratios are referred to as the golden mean, or divine ratio. These are one of the Fibonacci re-tracement levels and extension levels.
No comments:
Post a Comment