 We're gonna talk today about Fibonacci and I've got some really cool things for you. Lots of people use Fibonacci retracements. That's very common I'm going to review that I want to make sure everybody is on the same page So we'll start with some of them, you know, the late stuff the beginner stuff In fact, I'm going to take you right into the roots of where Fibonacci comes from and keep you my opinion on it Which you know very burns opinion and a $20 bill will get you a homeopathic amount of caffeine at Starbucks So take it for what it's worth. Yeah, you can decide whether you agree with me or not a little controversial Basically the way that I preach Fibonacci a little controversial, but hey everyone wouldn't shy away from controversy And so we'll show you the roots. We'll take to the basics a little intermediate and then I'm gonna show you some advanced stuff I know everybody loves the advanced stuff. Okay, but not everybody's there a lot of people are brand new so Before we get into the Fibonacci. Oh Let's talk about house rules and I know you've seen these legal disclaimers before but with these multi speaker events people come and go and so It's very important that you understand in this so it says no questions till the end I will stand or I will stay around and answer questions at the end So if you have any questions as I'm going through this, you know, rate them down You can put them in the chat box if you want to Absolutely, but I probably won't answer them until I get to the end and that's to just keep on line with our conversation here today keep it focused and Then make sure we get done on time as well. So That's number one. No trading with money. You can't afford to lose trading is very risky and We never eliminate the risk in trading. We manage it, but we can never eliminate it So never never never never how often never trade with money You cannot afford to lose you want to make sure that you always got money to Keep a roof over the table and food on the head. No, it's the other way around food A roof over your head and food on the table. That's it And obviously I'm a professional speaker All information this presentation for education purposes only not giving you any specific investment advice for you You said at your own risk Most people don't make any money trading just gonna throw it out there be very transparent and it's a profession So we do not allow any get rich quick mindsets here again I'd like to be very upfront with you let you know that this is not something, you know If you're starting now, you're not going to be a professional trader in a week just not going to happen it is a real profession that's challenging and Well, basically you got to be better than most people because most people lose money there now that we've started off On a positive note, you know are like super hyped But I got to do that that's not just for legal purposes, that's for you That's that's education that you're that's where your education should always begin So again, I'm dr. Barry Barron's the See they put my credentials in there. So that's great. I'll go through just this real quick I'm the author of trend trading for dummies. I've helped some other authors write their books I work with big big companies brokerage firms Exeter out there soft work Companies get readers choice of words from stocks that come out of these magazines Blah blah blah. Okay. That's all nice and good, but Now let's get to the bottom line Let's teach you some stuff on how to make money in the markets. So when we talk about Fibonacci The way most people use it I just want to start here to give you the context because I'm going to go behind the scenes deep into it to show you where it comes from And you'll be wondering well who cares about all these numbers And so I'm going to start it up by showing you the most practical application where most people use it So they use Fibonacci retrace maps and what that is is you would take your Fibonacci drawing tool and you would click here Pull it down and click here. So you're clicking from a major high a big swing high That just stands out in the market visibly to the naked eye drag it down here And then when you unclick here, it will draw these levels. So Fibonacci is about support and resistance levels Alrighty, so These are the ratios that are most commonly used 23.6 and that literally means that after the market made this low and starts coming up Okay, what's that lowest identified then you would draw your tool and the question is well if this is going to trend down continue a downtrend I Wonder what levels would be good places to short and take a trade in the direction of the downtrend Price levels. Where are we going to find? Resistance where the market stops going up and continues to go back down. So that's the Practical application So these are the common levels use 23.6 percent of the retrace from here to here see up here is a hundred percent So if we go all the way back up to the top, we've retraced a hundred percent of the beginning of the move Here 23 percent of it 38 percent 50 61 76. Okay, right. So that's just the bird's eye view now Where do these numbers come from first of all the ratios are a Secondary application of Fibonacci numbers the Fibonacci numbers themselves are a sequence and They were created by Leonardo of Pisa known as Fibonacci, which means son of Benosio and this is the sequence up here Actually got it in the header for you. All right now. It was actually introduced to the West in 1202 by him, but it was actually around before him So he's not the one who really was the first to identify this mathematical sequence that does have Scientific and mathematical Significance it was actually discovered in India long before he came across it, but I believe it was independently discovered So not to take any credit away from him. So what are these numbers? Well, they're a sequence of numbers beginning with 0 and 1 and then each subsequent number is the sum of the previous 2 Told you we're gonna start right at the beginning so you can see why people found these numbers to be significant So again starts with 0 and 1 so you can see it up here in the header except my Point of Froze. Okay, so 0 plus 1 equals 1 so 1 is the first number of the sequence All right, then what you do is you take these two numbers 1 and 1 and you add them together 1 plus 1 equals 2 See everything you needed to know about Fibonacci. You'll learn in kindergarten Well We're gonna get again real complicated here. So then you take these two numbers One plus two. Yeah, those puppies together and you get three So the first three numbers of the Fibonacci sequence are one Two and follow me carefully here Three Alright, so seriously bury this is just too easy. Well, wait a minute. Let's three for a little bit of a side loop here So now you take these two numbers two plus three add those together and now we skip four you go to five So four is not a number in the sequence, but five is one two three five Now we're gonna take the last two three and five add those together the next number in the sequence is eight If you go up here one two three five eight hmm Interesting five plus eight equals 13 and there you go. Okay, so that's the sequence and it goes on and on and on into infinity and beyond So why are the Fibonacci numbers considered significant? So again independently? discovered by mathematicians around the world who studied nature and They found that in natural patterns the organizing patterns of nature These numbers as you measured things in nature had an organizing principle of these numbers Mathematical so you could look at here's several examples the most famous one is the Nautilus shell and You'll find that if you mathematically Measure the design or the structure of things in nature these numbers keep coming up Okay, well, we're not here to be biologists we're here to make some money trading the markets and Now so you don't hear too many people who use the Fibonacci sequence anymore W. D. Gan did the famous trader W. D. Gan He actually used the numbers in the sequence these days what you're gonna hear most about is Fibonacci ratios So where do these ratios come from? Well each number in the sequence is approximately roughly They're about around 1.618 times greater than the preceding number So this is the foundational ratio often called the golden ratio or their golden mean in Fibonacci purist Which I am not by the way, that's the Number that they are enamored with the other two key ratios that are then determined by dividing a number in the sequence Two places to the right and three places to the right. So here's what I mean by that. Here's our Fibonacci sequence up here Alrighty and so the 61.8 ratios found by dividing any number in the sequence that's found one place to the right So as an example, we'll just start with 13. So 13 divided by 21 619 okay close enough for government work All right, and then 21 divided by 34 again 0.617 34 so here 34 55 These are the numbers take any number here divided by the number one to the right of it And you get your 618