Related Topics
US Markets

The Fibonacci Sequence: New Research Surprises Scientists

Fibonacci ratios appear throughout nature

by Bob Stokes
Updated: February 10, 2014

The structure of the DNA molecule, the shape of galaxies, financial markets and even the creative peak of Picasso all appear to share something in common -- namely, the Fibonacci ratio. 

The Fibonacci sequence begins with 0 and 1, and each subsequent number is the sum of the previous two: 0, 1, 1, 2, 3, 5, 8, 13, 21, 34, 55 and so on.

Elliott Wave Principle: Key to Market Behavior observes:

After the first several numbers in the sequence, the ratio of any number to the next higher is approximately .618 to 1 and to the next lower number approximately 1.618 to 1. The further along the sequence, the closer the ratio approaches phi ...

Phi (1.618 or .618) is also known as the Golden Ratio.

The Wave Principle of Human Social Behavior also says, "The DNA molecule...spirals in Fibonacci proportion."

The DNA molecule...spirals in Fibonacci proportion 

Now, new research shows that human creativity itself may reflect the Fibonacci ratio.

Academics who have studied the works of 200 of the world's most famous artists have calculated that they created their best art at a little before two thirds -- 0.6198 to be precise -- through their lifespan.

The scientists were surprised that the figure is nearly identical to the so-called "golden ratio" or Fibonacci code -- 0.6180 -- which has long been associated with optimal proportions in science and art.

Sunday Financial Times, Jan. 5, 2014

Fibonacci proportions also show up in financial markets. In the August 1999 Elliott Wave Theorist, Robert Prechter remarked:

Stock market analyst Robert Rhea undertook a statistical study of bull and bear markets between from 1896 to 1932. He knew nothing of Fibonacci. ... To generalize his findings, the stock market on average advances by 1s and retreats by .618s ... ."

Along with phi, the market's trends and turns include other Fibonacci-related ratios.

Financial Forecast Service | Financial Forecast, Elliott Wave Theorist, Short Term Update

Jump on once-in-a-lifetime opportunities and avoid dangerous pitfalls that no one else sees coming