Target CorporationEducation
Example of The Retracement Theory
On the chart I include the formula and a example of how to get shirt term price targets using the retrace theory.
Basic retracement theory
(B-A)+C
(130.77-128.71)+129.94=$132
the low = A
the retrace high = B
current retracement low = C
Trend Strength Maximum Retracements Upside Targets (downside targets are inverse)
Very Strong
-14.6% to 23.7%
A to B added to C
Easily exceed B
-Strong
38.2%
A to B added to C
Easily exceed B
-Medium Strong
38.2% to 50%
80% of A to B added to C
Should Easily exceed B
-Medium
50%
80% of A to B added to C
Should Easily exceed B
-Medium Weak
61.8% to 50%
80% of A to B added to C
Possibly exceed B
-Weak
61.8%
80% of A to B added to C
Possibly exceed B
-Very Weak
85.4%to 76.3%
80% of A to B added to C
Probably will not exceed B
Basic retracement theory
(B-A)+C
(130.77-128.71)+129.94=$132
the low = A
the retrace high = B
current retracement low = C
Trend Strength Maximum Retracements Upside Targets (downside targets are inverse)
Very Strong
-14.6% to 23.7%
A to B added to C
Easily exceed B
-Strong
38.2%
A to B added to C
Easily exceed B
-Medium Strong
38.2% to 50%
80% of A to B added to C
Should Easily exceed B
-Medium
50%
80% of A to B added to C
Should Easily exceed B
-Medium Weak
61.8% to 50%
80% of A to B added to C
Possibly exceed B
-Weak
61.8%
80% of A to B added to C
Possibly exceed B
-Very Weak
85.4%to 76.3%
80% of A to B added to C
Probably will not exceed B
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.