What charting methods are best for identifying price targets in revenue analysis?

2 Fibonacci retracements

Fibonacci retracements are horizontal lines that divide a price movement into segments based on the Fibonacci sequence. The Fibonacci sequence is a series of numbers where each number is the sum of the previous two numbers. The most common Fibonacci retracement levels are 23.6%, 38.2%, 50%, 61.8%, and 78.6%. They represent the percentage of the price movement that is retraced before resuming the original direction. To identify price targets using Fibonacci retracements, you need to select a significant high and low point on a chart and apply the Fibonacci tool. The price target is where the price meets one of the Fibonacci retracement levels. For example, if you are in an uptrend, you can select the low and high point of the last swing and apply the Fibonacci tool. The price target is where the price retraces to one of the Fibonacci levels before continuing the uptrend. Similarly, if you are in a downtrend, you can select the high and low point of the last swing and apply the Fibonacci tool. The price target is where the price retraces to one of the Fibonacci levels before continuing the downtrend.

3 Support and resistance

Support and resistance are horizontal levels that act as barriers for the price movement. Support is a level where the price tends to bounce off or find buyers, while resistance is a level where the price tends to reverse or find sellers. They are often formed by previous highs and lows, psychological numbers, or moving averages. To identify price targets using support and resistance, you need to mark the most relevant support and resistance levels on a chart and observe how the price reacts to them. The price target is where the price breaks through or bounces off a support or resistance level. For example, if you are in an uptrend, you can mark the previous resistance levels that the price has broken through and use them as support. The price target is where the price tests the next resistance level or bounces off the previous support level. Similarly, if you are in a downtrend, you can mark the previous support levels that the price has broken through and use them as resistance. The price target is where the price tests the next support level or bounces off the previous resistance level.

4 Chart patterns

Chart patterns are geometric shapes that form on a chart as the price moves. They reflect the psychology and behavior of the market participants and can signal the continuation or reversal of a trend. There are many types of chart patterns, such as triangles, wedges, flags, pennants, head and shoulders, double tops and bottoms, and cup and handle. To identify price targets using chart patterns, you need to recognize the pattern on a chart and measure its height or width. The price target is where the price moves by the same amount as the height or width of the pattern from the breakout or breakdown point. For example, if you see a triangle pattern on an uptrend, you can measure the height of the triangle at its widest point and add it to the breakout point above the upper trend line. The price target is where the price moves by the same amount as the height of the triangle. Similarly, if you see a head and shoulders pattern on a downtrend, you can measure the height of the pattern from the head to the neckline and subtract it from the breakdown point below the neckline. The price target is where the price moves by the same amount as the height of the pattern.

5 Here’s what else to consider

This is a space to share examples, stories, or insights that don’t fit into any of the previous sections. What else would you like to add?