|  AUG 1989

Fibonacci profit objectives by Joe DiNapoli

Fibonacci profit objectives by Joe DiNapoli Anyone who has been involved in the market for long has probably heard about Fibonacci numbers and ratios. We know they somehow mysteriously affect the market; however, most of us resist trying to understand how they work. I resisted because I thought that Fibonacci numbers, wave analysis and related systems were very difficult concepts to learn. Eventually, my desire to better understand the market and to win bigger overcame my prejudice. I quickly discovered that applying Fibonacci techniques to the market is not very difficult, and that a trader does not need to be an Elliott Wave technician to apply Fibonacci concepts. The Fibonacci number series (1, 2, 3, 5, 8, 13, 21, etc.) and the resulting Fibonacci ratios (0.146, 0.382, 0.5, 0.618, 1.0, 1.382, 1.5, 1.618, 2.618, etc.) are the heart of Fibonacci analysis. My technique of using Fibonacci expansion analysis uses only three ratios: 0.618, 1.0 and 1.618. With these three ratios, I calculate logical profit objectives. I can ignore most of the other ratios, as well as the entire number series from which those ratios are derived.

by Joe DiNapoli