A few readers have been asking for updates on the current Fibonacci Retracement Levels on the major US Equity Indexes, and I thought it would be a valuable resource to organize the four main US Equity Indexes with their respective Fibonacci Retracement Levels to watch, as drawn from each index's top in late 2007 to their bottoms in early 2009.

This post can serve as your reference to these unchanging and important levels traders of all methods are monitoring - and you can too.

Dow Jones:

[1]

The Fibonacci Retracement Levels on the Dow Jones are as follows:

61.8%:  11,246

50.0%:  10,334

38.2%:  9,422

S&P 500:

[2]

The Fibonacci Retracement Levels on the Dow Jones are as follows:

61.8%:  1,228

50.0%:  1,121

38.2%:  1,014

NASDAQ:

[3]

The Fibonacci Retracement Levels on the Dow Jones are as follows:

61.8%:  2,252

50.0%:  2,063

38.2%:  1,875

Russell 2000:

[4]

The Fibonacci Retracement Levels on the Dow Jones are as follows:

61.8%:  660

50.0%:  599

38.2%:  539

Keep in mind that many traders have these levels memorized for their respective index, and that's generally a good idea.

It's not that Fibonacci is 'magic,' but that traders monitor what happens at these levels, whether price retraces back to the downside or pauses an upward advance (both as a spot to take profits or potentially enter a counter-trend position) and as a spot to re-enter or add to existing long (buy) positions once a major retracement level has been broken. 

The thought process is that "Now that price has cleared that hurdle, it is safe to expect price to continue rallying to the next level."

As a quick note, the NASDAQ and Russell 2000 Indexes have recently cleared the important 61.8% Retracement hurdle, which is a very bullish sign.

The S&P 500 and Dow Jones index recently cleared their 50% retracement level, which suggests that price could continue the rally to challenge their respective 61.8% levels as shown above.

Use these grids as a reference for levels to watch both for targets to play for, and "all clears" once price officially rises above a key level.

Corey Rosenbloom, CMT

http://blog.afraidtotrade.com [5]

(All charts created with TradeStation)