Fibonacci and Gann Applications in Financial Markets

Application and Common Errors in Fibonacci Fanlines 101
is preferable to have a fairly steep fanline pattern, where the pattern comes to an end
fairly quickly, as this will limit the effect of the holiday and weekend issue and keep
the analyst focused on what happens next, especially if there is going to be a succession
of new highs created in a relatively short term and the origin is to remain
unchanged. This is a headache for analysts and in times of ‘running fanlines’ other
techniques may be more appropriate.
In the case of the arc pattern, time has been removed and the arcs are created from
simple geometry. However, because most charting packages will prefer to display
the arcs as true arcs of a circle, the incidental points where price cuts the pattern will
change depending not only on the time axis but on the scale of the price axis. The
arc will not change shape if the scale is moved, hence resulting in different positions
for the price cutting through the arc pattern.