[Chart of The Week] Fibonacci Strikes Again

JC Parets
July 10, 2019

If you're familiar with our analysis, you've probably noticed that Fibonacci Extensions and Retracements play a vital role in our process.

From setting upside objectives to identifying areas of potential support and resistance, Fibonacci is a versatile tool.

As with any tool, there are times when it works better than others. And while we don't want to get into every intricate detail of how and where we use it, we did want to share a great example of Fibonacci in action.

Below is a chart we came across while reviewing our universe and putting together our Q3 Playbook for Premium Members.

Titan Company Ltd. has been one of our favorite stocks on the long side, with Fibonacci Extensions of its 2015-2016 consolidation being a great guide for the trend along the way. Recently prices met our upside objective at 1,330, which was where the 685.4% extension of the 2015-2016 base and the 261.8% extension of the 2018 base coincided.

Click on chart to enlarge view.

Prices had been extended for a long time and momentum had diverged significantly all throughout this trend, but by running into this area of resistance at 1,330 there was finally a catalyst for sellers to take control...and they did in a big way.

Fibonacci is just one piece of our weight of the evidence process, but when it lines up with other data that supports the same thesis, that's when you see moves like this.

If you've not read about this subject and want to learn more about Fibonacci and how we use it at All Star Charts, check out this article, educational video, and conversation with JC and Todd Gordon.

Thanks for reading and let us know if you have any questions!

If you enjoyed this post and access to all of our premium research, start a 30-day risk-free trial or sign up for our "Free Chart of the Week" to receive more free research like this.

Allstarcharts Team

Filed Under: