I use Fibonacci levels frequently. They are amazing and work as well as any other indicator, if not better. If you're not familiar, do yourself a favor and read up on them. There's more than enough free information on the web.
If we are experiencing the crash I've been waiting for since 2010, then we're experiencing the piercing of a huge financial bubble. If that's true then we can expect this crash to continue all the way back to the beginning of the bubble. I figure that is March 9th, 2009, the announcement of QE1.
If this is a lesser crash, we can expect a reasonable bottom would be a 50% or 61.8% Fibonacci retracement level. 78.6% is another but not as common as the other two. Some people think 76.4% is a Fib level but its not. Its 100-23.6, where 23.6% is a valid Fib level.
The chart above is a monthly chart back to the Dot Com Bust aka Tech Wreck. Some people think the bubble started there but you can see March 9th, 2009 is even lower. So we'll use that as the bottom of the bubble. I pulled a Fib range from the recent high back to March 9th, 2009. The levels and calculations are shown on the chart. Here's the bottom line for some likely targets for the Dow Jones Industrials Index:
50% Retracement: 18,020
61.8% Retracement: 15,294
Bubble Bottom: 6,470
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