Drawing the with the Fibonacci Tool with the correct ratios has a profound effect - you can start to see where the market will reverse with surprising accuracy, even when the market is creating new highs.
To set our Fib tool we use these ratios:
0 - Trend Beginning
.5 - Half (not a number, but I find value in having it)
1 - Trend End
We can then use the tool to look for new resistance/support that has not been drawn yet.
:PAST: Drawing A to B shows us the next resistance at the 1.618 line. It hit and reversed at that point (around 350 points off) SEE CHART
:PAST: Drawing C to D shows us the next resistance at 1.618 as well, where price resisted and was able to break through to the 2.618 (around 80 points off)
:PRESENT: Drawing C to E will show new possible support/resistance- We would normally use past values to draw this, but there are none!
-------------We may even look further for the . (not drawn) and the . (also not drawn) for price to bounce and resume upward. ----------------------
: FUTURE: Drawing from (new low point) to E will show us the next possible stopping point for the DOW
This is all due to @cdschultheis HE PREDICTED ONE OF THE BIGGEST CORRECTIONS OF THE DOW, AND DIDN"T POST IT. hahahaha
Look for the same measurement C to D to have some sideways movement at 3.618
That being said, I still believe in the way that it's drawn from C to D, and will be looking for another correction at 3.618 :)