Forex Fibonacci Theory – The array of Fibonacci numbers and golden ratios can be found all over the world and all technical indicators such as Gann applied them to financial markets and made millions of people use this unique theory as part of their trading method. The Fibonacci number sequence and the golden ratio are now used by many savvy traders. We can see how they can make huge profits in ANY financial market.
So, in what ways is Fibonacci used for trading? In this case, it is the support and resistance levels that use the Fibonacci sequence. We know that support and resistance levels are very important for all traders because they can help identify entry and exit points during a trade. The Fibonacci “retracement” percentage level derived from the Fibonacci number sequence and the golden ratio is an innovative tool that is useful for every trader.
The question is, how did the Fibonacci sequence come from that makes this theory so useful? Let’s see!
How many pairs of rabbits can be produced from a single pair if every month each pair produces a new pair? With a note, the new rabbits are born in the second month after a pair of mother rabbits mated.
The question can finally be solved using the Fibonacci sequence and the golden ratio. And finally make the Fibonacci series of numbers have significance for the whole world of science.
After some initial numbers, the ratio of any number in this series, when compared to the next higher number is about 0.618, and when compared to the lower number is 1.618. This comparison figure is known as the Golden Mean and Golden Ratio.
Studying numbers can be fun and will appear throughout biology, art, music, climatology, creatures and even architecture. Examples of natural objects that use the base Fibonacci Ratio are: snail shells, galaxies, hurricanes, DNA molecules, sunflowers and many other objects that occur in nature.
Inspiration From: aroundforex.com