# Fibonacci Spiral

The Fibonacci Spiral & Fibonacci Time Projection is also among the popular Fibonacci Studies in the Forex market. Using these two methods in combination help traders to determine powerful Support & Resistance levels of the market along with time prediction also. While the Fibonacci Time Projection is common and used with normal rules and procedure, the Fibonacci Spiral strategies are used by different traders differently and many traders have their own secrets of using them in a unique way which they do not disclose. So, it is possible that some traders may have very accurate results from Fibonacci Spiral (Eg. Institutional traders) while some others may not so.

## Fibonacci Spiral:

Fibonacci Spiral can be made by first randomly picking a Starting Point (However, it will be depend upon your experience, how you smartly select a “nice” Starting point). Then calculate key Fibonacci ratios for the certain key price levels of the market. Fibonacci Ratios for example, can be calculated as follows:

Take the ratio of two successive numbers in Fibonacci series, (1, 1, 2, 3, 5, 8, 13& so on) and we divide each by the number before it, we get find the following series of numbers:

### 1/1= 1,  2/1= 2,  3/2= 1·5,  5/3= 1·666,  8/5= 1·6,  13/8= 1·625,  21/13= 1·61538.

Then we start increasing the width of points for quarter turn along the spiral from the center by multiplying the width with the pre-calculated “Fibonacci Ratios”.

Selecting the starting point is however a difficult task. Basically, what we are to do is to select some very strong support/resistance level, which is very obvious & then we expand our spiral from that origin with the help of Fibonacci ratios. Now after drawing our Fibo Spiral, we will be able to forecast the major/critical price levels on the chart, where major market events/volatility is highly expected, like price reversals, huge spikes etc. So we are able to forecast the broad behavior of the market at certain times as found by the intersection of the spiral with the chart grid.

Thus, with the help of Fibonacci Spiral, we can find an optimal link between the price and the time and can effectively and efficiently predict the crucial volatility levels of the market. Every point on the Fibonacci Spiral gives us an intersection of some particular price and time, and mostly at these levels of price and time, the market shows a significant activity at those intersection points and the spiral keeps guiding us about this as it also keeps growing on the same path with the time.

## Fibonacci Time Projection:

The Fibonacci Spiral can be reconfirmed by the Fibonacci time projection analysis. If we get Double-Co-incident signal from both of these Fibonacci strategies, we get more confidence to initiate our trade. The Fibonacci Time Projection analysis involves selecting a “decent” and a “Strong” swing movement of the asset for a given time. This swing movement may be selected on a simple criteria also like by taking Two High + Two Lows Or by taking One High + One Low but the size of the swing should be a decent one.

Then the Fibonacci levels of time are estimated based on these two critical levels of the market and multiplying the further values with the Golden Fibonacci Ratio of 1.618 and so on. Though Fibonacci Time Projection is a good tool to forecast the important times of the market, where the significant movements are highly expected in the price of the asset, but in some cases, it has been observed that the significant events get happened a little bit earlier or a little bit after the anticipated time, hence giving a dis-appointment to the traders. So, for a better accuracy and eliminating the false signals, it is advisable that the Fibonacci Time Projection analysis should be used in conjunction with the Fibonacci Spiral Analysis and with other supportive data like Stochastic etc.

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