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“Fibonacci Ratio Analysis with Elliott Wave”

Learn To Trade Class #3 Plan Your Trade, Trade Your Plan. “Fibonacci Ratio Analysis with Elliott Wave”. 1.618. Today we will learn how to combine Fibonacci Ratio Analysis with EW for trading entries and exits. We will begin at 7:30 PM ET – You will hear no sound until we start. Fibonacci.

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“Fibonacci Ratio Analysis with Elliott Wave”

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  1. Learn To Trade Class #3 Plan Your Trade, Trade Your Plan “Fibonacci Ratio Analysis with Elliott Wave” 1.618 Today we will learn how to combine Fibonacci Ratio Analysis with EW for trading entries and exits. We will begin at 7:30 PM ET – You will hear no sound until we start

  2. Fibonacci “How many pairs of rabbits placed in an enclosed area can be produced in a single year from one pair of rabbits if each pair gives birth to a new pair each month starting with the second month?” - Elliott Wave Principle Fibonacci Pisano Bigollo (“Leonardo Fibonacci”) circa 1170 to 1250 discovered the Fibonacci sequence by breeding rabbits.

  3. Fibonacci #’s & Ratios The Fib sequence each # is the sum of the two #’s preceding it, starting with 0 and 1. - 0, 1, 1, 2, 3, 5, 8, 13, 21, 34, 55, 89, 144, 233, 377, etc.

  4. “God does not play dice with the universe.” - Albert Einstein

  5. 1.618 Golden Ratio

  6. 1.000 0.618 FIBONACCI

  7. FIBONACCI 0.382 0.618

  8. 0.382 0.618 Fibonacci

  9. Fibonacci #’s & Ratios

  10. Fibonacci #’s & Ratios The Fibonacci Sequence 0, 1, 1, 2, 3, 5, 8, 13, 21, 34, 55, 89, 144, 233, 377, 610, 987, etc Fib retracement ratios are the ratio of any # to it’s next higher #. Example : 0/1 = 0 (Starting Point) Example : 1/1 = 1 (Ending Point) Example : 1/2 = 0.50 (Major retracement level)

  11. Fibonacci #’s & Ratios The Fibonacci Sequence 0, 1, 1, 2, 3, 5, 8, 13, 21, 34, 55, 89, 144, 233, 377, 610, 987, etc Fib retracement ratios are the ratio of any # to it’s next higher #. Once we cross the fourth set of fib #’s the ratios start to narrow down to the inverse of the Golden Ratio – 0.618 Example : 2/3 = .6666 3/5 = .6000 5/8 = .6250 8/13 = .6153 13/21 = .6190 21/34 = .6176 34/55 = .6181 55/89 = .6179 89/144 = .6180 144/233 = .6180 233/377 = .6180 377/610 = .6180

  12. Fibonacci #’s & Ratios The Fibonacci Sequence 0, 1, 1, 2, 3, 5, 8, 13, 21, 34, 55, 89, 144, 233, 377, 610, 987, etc. Extension Ratios 1.236, 1.500, 1.618, 2.0, 2.618 Derive Fib Extension levels by taking the ratio of any # to its next lower #. The sequence narrows down to the Golden Ratio – 1.618 Example : 1/0 = 0 1/1 = 1 2/1 = 2.000 3/2 = 1.500 5/3 = 1.666 8/5 = 1.600 13/8 = 1.625 21/13 = 1.615 34/21 = 1.619 55/34 = 1.617 89/55 = 1.618 144/89 = 1.618

  13. Fibonacci #’s & Ratios 2.00 1.618 External Retracements Expansions -For exits on trend trades -For entries on counter trend trades 0.00 Retracements -For entries 0.382 0.50 0.618 100.0

  14. Fibonacci Retracements Retracements ratio’s are used to analyze corrective Waves …. by measuring previous motive waves 38.2% 100% 61.8% 100%

  15. Fibonacci Retracements • Helps determine the completion of a Correction • Serves as potential Entry levels for trades in the direction of the larger trend Key Ratios • 23.6% • 38.2% • 50.0% • 61.8% • 78.6%

  16. Fibonacci Retracements Retracements for Entry Identify a completed 5-wave impulse & anticipate a 3-wave correction 0.00 5 Measure impulse wave to define retracement levels 0.382 B 3 0.50 0.618 Watch for the end of correction for entry 4 0.786 A 1 100.0 C 2

  17. Motive Waves Already Completed Corrective Waves To Study With Retracements Wave 1 Wave 3 Wave A Wave W Wave 2 Wave 4 Wave B Wave X Retracements

  18. Motive Wave Tip Quickly access the Trading Analysis Fib ratios within the wave count Retracements

  19. Motive Wave Tip Access the default Fib ratios from the components panel Retracements

  20. External Retracements Ext. Ret. ratio’s are used to analyze motive waves 127.2% …. by measuring previous corrective waves. 261%

  21. External Retracements • Helps determine the completion of a motive wave • Serves as potential Exit levels for trades in the direction of the larger trend • Serves as potential entry for contra-trend trades Key Ratios 127.2 % 161.8 % 200.0 % 261.8 % 423.6%

  22. External Retracements Extensions for Exit 3? Identify a completed correction & anticipate a new impulse wave 2.00 1.618 1 Measure corrective wave to define extension levels 2 1.272 1.00 5 B Watch for the end of correction for entry 3 0.618 A 0.000 C 1 4 2

  23. Corrective Waves Already Completed Motive Waves To Study With Extensions Wave 2 Wave 4 Wave B Wave X Wave 3 Wave 5 Wave C Wave Y Ext. Retracements

  24. Motive Wave Tip Quickly access the Trading Analysis Fib ratios within the wave count External Retracements

  25. Motive Wave Tip Access the default Fib ratios from the components panel External Retracements

  26. Fibonacci Expansions 200% Expansions are used to measure motive waves …. by measuring previous motive & correctivewaves.

  27. Fibonacci Expansions • Helps determine the completion of a Motive wave (W.1,3,5,A or C). • Serves as potential Exit levels for trades in the direction of the larger trend, or entry levels against the trend. • Serves as potential entry on counter-trend trades Key Ratios 38.2 % 61.8 % 100.0 % 161.8 % 200.0 % 261.8 % 423.6%

  28. Fibonacci Expansions 1.618 Expansions for Exit Identify a completed Motive & Correction & anticipate a new 5-wave motive. 1.000 0.618 Click 2 Measure (click) the 3 end points of the Motive & Corrective Wave. 0.000 Click 3 5 B 3 Watch for the end of the Motive wave at Expansions ratios for exit. A C 1 4 Click 1 2

  29. Corrective Waves Already Completed Motive Waves To Study With Extensions Wave 1,2 Wave 3,4 Wave 1-3 Wave A,B Wave W,X Any 2 adjacent waves in a triangle Wave 3 Wave 5 Wave 5 Wave C Wave Y Waves C, D, E Expansions

  30. Motive Wave Tip Quickly access the Trading Analysis Fib ratios within the wave count Expansions

  31. Motive Wave Tip Access the default Fib ratios from the components panel Expansions

  32. A Fib zone is at least two Fib ratios in close proximity to each other • Combine all Fib tools: retracements, extensions & projections to calculate a Fib Zone • F.S.Z = Fib Support Zone – with a completed wave pattern, these are buying opportunities • F.R.Z = Fib Resistance Zone – with a completed wave pattern, these are selling opportunities Building A Fib Zone

  33. Building A Fib Zone

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