The golden section line is one of the most common and popular tangent analysis tools in the stock market, and in practice, it is mainly used to reveal the adjustment support level of the rising market or the rebound pressure level in the falling market. However, the golden section line does not take into account the impact of time changes on stock prices, and the support and pressure levels revealed are relatively fixed, so investors do not know when they will reach the support and pressure levels.

Use of the Golden Section in Investing

In stock price forecasting, there are two methods of golden section analysis based on the two sets of golden ratios.

The first method: to the stock price recent trend in the important peaks or bottoms, that is, important highs or lows for the calculation of the measurement of the future trend of the basis, when the stock price rose to the bottom of the stock price as a base, the decline in reaching a certain golden ratio is more likely to be supported. When the market is close to the end, the stock price after a sharp rise or fall, the rate of its rise or fall to reach a certain important golden ratio, it may occur when the turnaround.

The second method: the market after the turn, whether it is the reversal of the stop-loss to rise or the reversal of the stop-lift to fall, to the recent trend of important peaks and bottoms between the amount of up as the basis for measuring the original up and down by 0.191, 0.382, 0.5, 0.618, 0.809 divided into five gold points. Stock prices in the post-turn after the trend will likely encounter temporary resistance or support in these golden points.