How to take a calculated risk in the stock market by using Fibonacci Cycle

To make the most of the opportunities that equity markets present, one needs to timely take a call on a particular stock movement. While fundamentals of a company support long-term prospects, technical analysis can help an investor eke out (and/or avoid) short-term gains (losses) by helping him/her identify reversal in a stock’s trajectory.

One of the widely used analyses to identify such swings or reversals is Fibonacci cycles or Fibonacci Time zone. Under this analysis, an investor studies major swings or reversal points of a stock, or index, over a period of time. These points, known as Fibonacci Intervals, are