Fibonacci Forex Trading – Application to the Forex Market
The Fibonacci number series is ubiquitous. It is everywhere, whether one is aware or not. Not only was it prevalently found in older cultures (Greek, Egyptian, and Hebrew), in elements of life (DNA molecule and the human body), and even in recent studies of the entire universe, Fibonacci numerical relationships play a very significant yet subtle role in market action and hence, trading. Even more, Fibonacci Forex trading has actually become the platform of a majority of Forex trading systems and is used by numerous professional Forex brokers all over the world.
Yet, it may well be asked why a relatively simple series of numbers would play such a strong role in the Forex market with traders quite often separated by culture and great distances. The difficulty in perceiving the possibility of this at least in part comes from a human tendency to believe itself to be independent and somewhat separated from nature. Certainly, when we are injured, sick, or close to death, the influence of nature in our lives is quite obvious.
However, under ‘normal conditions”, our intelligence gives us a sense of being “above” the control of nature, especially in a collective sense and blinds us to elements of the truth. The truth under discussion is that changes in market prices largely reflect human opinions,expectations, and valuations. A series of studies, published in the 1980s by mathematical psychologist Vladimir Lefebvre, demonstrated that humans exhibit positive and negative evaluations of the opinions they hold with 61.8% positive and 38.2% negative.