One of the most consistent tools for determining price objectives is the 60-40% retracement derived from the Fibonacci .618-.382 relationship. This is a general area— close to 60%, and close to 40%. 60-40% Retracements are used to determine a price range for cyclic highs to occur in bear markets, and cyclic lows to occur in bull markets. 60-40% Retracements are only valid if the next longer cycle continues to move in the same direction. This price range should be used in conjunction with 70% cyclic Timing Band.
Most intermediate and daily cycles will retrace at least 40%. The 60-40% measurement can often be used to enter a market when a cyclical top or bottom is due. Often, if a buying or selling opportunity is missed, you can enter the market as it retraces and still catch a substantial part of the move.
