Curiousity and Fibonacci sequences


Curiosity shouldn't stop when one reaches adulthood. I believe we have a deeply curious nature that persist with age. Not only is our curiosity expanding outwardly, we are also looking deeper into our own psyche. One may link this behavioral characteristic that we have to an evolutionary explanation of "exploring to survive".

There are some pointers in the concept of number sequences that is worth being curious about.

Fibonacci Retracements is a set of resistance/support lines I use for my charts, it is derived from a sequence of numbers also known as the "Golden Ratio". Fibonacci sequences appear in biological settings too(click here). These ratios seem to play an important role in the stock market, just as they do in nature. If these retracements lines can be statistically shown to encompass human sentimental thresholds, then this will prove that the fibonacci numbers are intrinsic in our human psyche.

Elliot wave principle is derived from the Fibonacci sequences. The basis of the Elliot wave theory is developed from the observation that cycles in nature, whether of tide, the planets, day and night, or even life and death, had the capability for repeating themselves. Those cyclical movements were characterized by two forces: one building up and the other tearing down. This theory was incorporated into charting by wave theorists in hope to see a similar cycle of movement in human rationality. Although one has to understand that these theories could be self fulfilling, which means it is hard to know whether our psyche is really in tuned with these patterns, or whether these pattern are being followed subconsciously by us.

I find the exploration of market sentiments to be interesting thus far. We should stay opinionated, but we should also have an open mind to change our views when a more plausible explanation is put forth. Only when we start to probe, can we then hope to understand more.

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