Fibonacci is a Fan of the S&P 500
- Posted by Greg Harmon
- on September 28th, 2012
The weekly chart of the S&P 500 below shows the price action over the last 2 years. Following the move higher from the October 2011 lows to the April 2012 highs it pulled back and is now riding the middle trend line higher. But that line goes back to the October 2011 low, what is it? A Fibonacci Fan line. These Fans are drawn by creating lines from the previous low rising up through the point where the key Fibonacci levels, 38.2%, 50% and 61.8% meet the vertical line dropped from the previous high (in blue here). These measure the extent of the pullback in terms of how fast it is
moving, so are also known as Speed Lines. They are important because they can often act as support or a reversal point. In this case the 50% Fan Line has been good support with only a brief one candle dip below it that was immediately erased the next week. I have attached a link to a good article on Stockcharts.com below if you want to learn more details about Fan Lines.
Dragonfly Capital Views Anniversary Celebration
For a limited time the Opportunity to join the Dragonfly Capital Views Premium Membership on an Annual basis is available for only $600.
This is 20% off of the standard annual subscription price and nearly 45% off of a rolling monthly membership! Don’t miss this limited opportunity! Sign up here.
Want to learn more about Dragonfly Capital Views?
From Stockcharts.com: Fibonacci Fans
If you like what you see above sign up for deeper analysis and trading strategy by using the Get Premium button above. As always you can see details of individual charts and more on my StockTwits page.
The information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment. I or my affiliates may hold positions or other interests in securities mentioned in the Blog, please see my Disclaimer page for my full disclaimer.blog comments powered by Disqus
Gregory W. Harmon CMT, CFA, has traded in the Securities markets since 1986. He has held senior positions including Head of Global Trading, Head of Product Development, Head of Strategy and Director of Equity. (More)
Dragonfly Capital Updates
- Macro Week in Review/Preview March 7, 2014
- Top Down Options Trading, Risk Management, and Collars
- Time to Sell Corn?
- Long Term Pick of the Week: Bridges, Iron and Voodoo
- Premium Earnings 3-6-14
- Your Second Chance in Natural Gas Is Here
- The Third Pitch From OpenTable
- Premium Earnings 3-5-14
- Prepare for The Euro Breakout
- Hogs and Bats and Crabs