It’s taken me a few years to realize that Fibonacci isn’t some type of pasta dish.
According to Wikipedia:
“In the Fibonacci sequence of numbers, each number is the sum of the previous two numbers, starting with 0 and 1. Thus the sequence begins 0, 1, 1, 2, 3, 5, 8, 13, 21, 34, 55, 89, 144, 233, 377, 610 etc.”
The Fibonacci sequence was also the basis of many Renaissance artworks where it was better known as the golden ratio.
A lot of investors believe that Fibonacci calculations can give you insights into stock market movements. Proponents say that patterns underlie everything in the universe–from the shape of shells to the position of your nose… even the highs and lows of the stock market.
I guess the important thing is: what do Fibonacci numbers say about the near term future?
One of our partners is INO. They are masters at using and explaining the use of the Fibonacci sequence as part of market analysis and forecasting.
If you want to learn more about Fibonacci Numbers, you can check out the video here: INO Education. According to the folks at INO, we might be in for a pretty bumpy ride. The last few months have been positive for stocks, but that trend may be running out of steam.
(INO offers other tools for traders. You can try out their Trend Trading analysis for free. Just enter your email and you’ll receive access to the site. Enter the ticker symbol and you’ll be able to review INO’s recommendations.)