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Re: Fibonnaci price projections?



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At 02:38 PM 3/16/99 -0700, Linda Swope wrote: >>>> I could use some help from those of you using Fibonnaci ratios to set price projections. I have found 2 different formulas from Joe DiNapoli and Robert Fischer. They calculate the projections quite differently.

If a stock moves in price from point A to point B, and then retraces back to point C, DiNaploi figures you take (B-A), the length of the original move, and multiply it by .618 or 1 or 1.618 and add the results to C.

Fischer figures you take the length of the retracement, multiply it and add it to C.

One uses the length of the original move and the other uses the length of the retracement as the basis. I've seen other formulas as well. All give such different results. Any thoughts from anyone?

Thanks! Linda

Linda,
I talked to Joe DiNapoli about your question, to get his input for you.. Here is his reply (Joe is not a member of this list) to you:
Hi Linda,
Plank, Fisher and even Prechtor measure the projection from the B point of the wave rather than C. Way back in the mid eighties when I did most of my initial research I tried it both ways real time trading the S&P. From the standpoint of mathematics you can make a case for either way. For trading though,there was no contest as far as I'm concerned. Point C is much more accurate. I'd recommend you try it both ways for a year or so and see for yourself which method is more practical. -Jo
Good trading, -Neal.


----------------- Neal on the 'net. Trade well. Train hard. http://www.halcyon.com/neal/