Stocks Investing - The Fibonacci Sequence number

 
 

The Fibonacci Sequence

The Fibonacci Sequence is the concept of natural law also embraces an extraordinary numerical series discovered by a thirteenth-century mathematician named Fibonacci.

The Fibonacci number series that carries his name is derived by taking the number 2 and adding to it the previous number in the series. Thus, 2 + 1 = 3, then 3 + 2 = 5, 5 + 3 = 8, 8 + 5 = 13, 13 + 8 = 21, 21 + 13 = 34, and so on. The series becomes 1, 2, 3, 5, 8, 13,21,34,55,89, 144, 233, and so on. It has a number of fascinating properties, among which are the following

 

1. The sum of any two consecutive numbers forms the number following them. Thus, 3 + 5 = 8 and 5 + 8 = 13, and so on.

2. The ratio of any number to its next higher is 61.8 to 100, and the ratio of any number to its next lower is 161.8 to 100

3. The ratio 1.68 multiplied by the ratio 0.618 equals 1.

 

The connection between Elliott's observation of repeating cycles of nature and the Fibonacci summation series is that the Fibonacci numbers and proportions are found in many manifestations of nature.

For example, a sunflower has 89 curves, of which 55 wind in one direction and 34 in the opposite direction. In music, an octave comprises 13 keys on a piano, with 5 black notes and 8 white. Trees always branch from the base in Fibonacci series, and so on.