Intraday Stock Setups with Fibonacci
I am asked frequently if
the Fibonacci work that Carolyn and I do works on shorter time frames. The answer
is a resounding “YES!” Below is an example with AOL Time Warner (AOL). The first
chart below is a 60 minute chart of AOL through Wednesday. As you can see, the
trend is down, and the last two days of price movement have formed a two step
corrective pattern into price resistance from 19.43-20.05. So, I was looking
to short against this zone for a short term scalp. So, let’s see what happened…
Sure enough, AOL respected
our resistance zone, and traded down hard in the morning, losing almost $1.00
by mid-day. As I type AOL appears to be finding footing around our minor Fibonacci
price support zone on the 60 minute chart below at 18.44-18.52. So, back to
the original question… “Does Fibonacci work on shorter time frames with stocks?”
You bet!
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