Skip to comments.Fibonacci Fate Date for a Bear Bond Market?
Posted on 08/05/2011 1:42:29 PM PDT by george76
One of the greatest technicians of all time was a man named W. D. Gann (1878-1955). He had tremendous success predicting market moves much in advance. Legend has it that he occasionally sent notes to The Wall Street Journal, which accurately predicted tops and bottoms in grain markets months ahead of time.
There are two Gann principles that I have always respected. They are that historical prices alone arent predictive unless paired with time; and that the birth dates of contracts are of major significance. The birth date is the first day a contract, stock, or grain begins trading. And birth dates that occur during "Fibonacci" years are even more significant. The larger the Fibonacci number, the more significant.
Leonardo Fibonacci, the great 13th century Italian mathematician (11751250) created the Fibonacci sequence to explain behavior in nature mathematically. History has it that the first question he posed was how many rabbits would be created in one year starting with one pair.
On August 22, l977, the Chicago Board of Trade started trading 30-year bond futures. This year, August 22 falls on a Monday. It will be the THIRTY-FOURTH ANNIVERSARY (34 is a Fibonacci number). My goal is not to make a market prediction as much as to share a fascinating possibility.
The next Fibonacci number is 55, it's a difference of 21, which could determine the length of the next cycle. If this Gann cycle is accurate, it may mean a cycle high in price, a cycle low in rates in the Treasury complex could occur possibly on August 22, or thereabouts. Another way to look at this would be, that it may be the BEGINNING OF A 21-YEAR CYCLE in lower prices, higher rates.
(Excerpt) Read more at cnbc.com ...
how about if a unicorn is born in a fabinacci year? how long will its horn be?
i have no idea why i posted that. maybe just had too many honey grahms and mile for lunch
W.D Gann , Fibonacci , and Rick Santelli
The answer will be quite apparent if you examine the horn.
The fabinacci series plot is a spiral. The limbs and stqlks of trees and plants of some species grow in a fabinacci spiral. The nautilus and ammonite shell spiral is a fabinacci function. Ditto pine cones (which won’t roll down hill as a result).
It is fairly well known that the horn of a unicorn is spiral and thus a fabinacci function. There for, knowing the spiral rings and the year and subsequent fabinacci, the growth and length can be calculated year .
Tip of the hat to Lyndon Larouche and his cold fusion magazine and numerous articles on fabinacci serie and the golden mean
1” the 1st year
2” the next year
3” the next year
5” the next year
8” the next year
13” the next year
21” the next year...
You can find, or rather extract, mathematical relationships to ANY series or sequence of events, but only AFTER the fact..
Rick's a really good guy..but he should stick to RANTS from now on..
This reminds me of Hitchhikers Guide to the Galaxy. The answer to the question of Life, the Universe and Everything is “42” and the question is “what is 6*9”.
It is fascinating though. Often stocks that are correcting do seem to go to their fibonacci levels though probably be cause of all the fibonacci cult members out there trading every day.
Who knows. There are fundamental reasons though why treasuries will sell off so it could definitely come to pass.
But I just 8.
Criminal minds? What is that?
This is what happens to your mind when you spend too much time trying to understand Leesman.
Part of what makes technical analysis of securities work is that so many people use it. ie, it is a self-actualizing result by traders. And because other traders use it, I’ll use it.
The greatest fraud perpetrated upon the investing public in the last 30 years have been two theories about securities:
1. That securities price movements are random, and can be modeled with Gaussian distributions.
2. The Efficient Markets Hypothesis, wherein advocates claim that everything known and unknown is priced into a security.
Since Rick has spent quite a bit of time in trading pits before he became an on-air color commentator for CNBC, he’s got some perspective of what he speaks on trading. There are some guys who trade on chart patterns, some who use Fib fans/retracements, some who are advocates of Gann patterns, some who use candlestick patterns, some who use point-n-figure charts to find patterns... they all work to some degree on some securities some of the time.
The secret to making a profit in using these things in trading is to contain your losses. There are really only four things that can happen to the price of a security:
1. It goes up a lot.
2. It goes up a little.
3. It goes down a little.
4. It goes down a lot.
In trading, I insure that I avoid 4 and some of 3 through loss containment. The rest of condition 3 that I don’t contain by pruning losses is equalled over time by condition 2.
Too many people look for the “magic predictor” that gives them a home run every time. No such thing exists. If I’m doing everything correctly, only about 55 to 65% of my trades are profitable. Maybe one in 15 are over 10%.
IMO, too many “professionals” fed the retail investing public utter pablum about “buy and hold” and these poor people have been screwed out of huge sums in the last 10 years. We’ve had 10+ years now of sideways movement in the equities markets in the US, and we’re bound to have at least another five years of really choppy markets.
In the episode I referenced, George Costanza played a serial killer who constructed his crimes based on patterns discerdn from Fibonacci numers, and the spirals..
The series reruns constantly on many networks....see if you can find the episode, and when it's one next time..
i stand corrected sir !!
I learned about it (and later forgot) from Mathnet years ago:
Where I would take issue ( as pertains to investment advice given to the general public) is your knock on "buy and hold."
I believe in that firmly, especially when an investor is in the accumulation phase of his lifetime, AS LONG AS IT IS ACCOMPANIED BY THE FOLLOWING PARAMETERS:
1. Continuous reinvestment..the old "dollar cost averaging"..which most people do via 401ks and other self-directed plans.
2. Focus on investments that pay dividends..and keep reinvesting them. Many studies have shown the value of reinvesting over time.
3. Focus on costs. Investors are absolutely slaughtered by a fee structure that rapes them..from wrap accounts, to sales charges, to commissions, to variable annuities, to 12(b)1 fees..and the list continues..these can average as much as 2% a year over time...and it's hard to make money with a perpetual 2% haircut...
Remember Tom Lehrer..? "New Math"
If your team was victorious, press ‘won’
If you want directions, press ‘to’
If you are a woodsman, press ‘tree’
If you are in favor, press ‘for’
If you are disgusted, press ‘fie’
If you have more than one ill person, press ‘sicks’
If you are looking for a Norwegian, press ‘Sven’
If you have already been fed, press ‘ate’
If you are German and want to say no, press ‘nein’
If you are a WWII Japanese fighter pilot, press ‘zero’
If you are an astronomer, press ‘star’
If you are British and are ringing for money, press ‘pound’