Price is not the only variable in technical analysis. Changing time, which is important for opportunity cost, is a significant subject of study. For this reason, Fibonacci therioes are used in time zones like price movements.
Fibonacci time zones are composed of vertical lines which are drawn from trough or peak thanks to Fibonacci numbers. Trough or peak is accepted as zero in drawing stage. After that, lines of time zone, which were formed thanks to using of Fibonacci number, are placed on the top of price graph. According to basic logic, which is benefited in using of Fibonacci numbers in this method, each Fibonacci number represents for number of days in time zone. That is to say, 1 ,which is the first Fibonacci number, represents for time zones of one day, and 2, which is the second Fibonacci number, represents for time zone of two days, also 8, which is the fifth Fibonacci number, represents for time zone of eight days. Briefly, Fibonacci time zones should be drawned to hit day period of 1., 2., 3., 5., 8., 13., 21. and 34.
According to basic logic of this method, important movements occur in each time zone. Fibonacci time zones do not give buying-selling signals unlike other analysis methods of Fibonacci, and they are used to identify time of fluctuations
- Date: 20 November 2016 Sun 02:58
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