V.16:10 (460-464): Long-Term Fibonacci Support and Resistance by Kevin W. Murphy

Here's a historical review of the major swings in the stock market and the Fibonacci relationships.

According to long-term FibonacciÝ support and resistance levels in the Dow Jones Industrial Average (DJIA), we are approaching a notable resistance level in the stock market. Many books have been written on the Fibonacci sequence and its many mathematical relationships; this article will not delve into those in any great detail. For those who are unfamiliar with the Fibonacci sequence, however, I will briefly discuss its basis and a few of its mathematical relationships and how they are relevant to investors. Leonardo of Pisa, a 13th-century mathematician, illustrated what would later be known as the Fibonacci sequence in his work Liber Abacci, although its mathematical relation-ships were not detailed until much later. The Fibonacci sequence is an additive sequence in which each number is the sum of the two numbers preceding it. Beginning the sequence with 1, it progresses thus: 1, 1, 2, 3, 5, 8, 13, 21, 34, 55, 89, 144, 233, 377, 610, 987, 1597...on to infinity.