What is the FourNineFour Rule?
The FourNineFour Rule (494 Rule) is a technical analysis concept used in financial markets. It identifies potential reversal or continuation points by measuring 49.4% of the distance between a swing high and a swing low.
How to Use This Calculator
- Enter the Swing High Price - The highest price point in your identified swing pattern
- Enter the Swing Low Price - The lowest price point in your identified swing pattern
- Enter the Current Price - The current market price
- Select the appropriate Timeframe for your analysis
- Click the Calculate button to see the results
Interpreting the Results
- The Target Price (49.4% Level) represents a potential area where the price might reverse or continue moving
- The Distance from Current Price to Target shows how far the current price is from the 49.4% level
- The Distance from Current Price to Target (%) indicates what percentage of the overall range the current price has moved
Trading Strategies Using the FourNineFour Rule
Traders often use this rule to identify potential entry points for various strategies:
- Breakout Confirmation: If the price breaks above the swing high and reaches the 49.4% target, it may confirm a bullish breakout
- Breakdown Confirmation: If the price breaks below the swing low and reaches the 49.4% target, it may confirm a bearish breakdown
- Support and Resistance: The 49.4% level can act as dynamic support or resistance
- Swing Trading: Traders may look for opportunities to enter trades when the price reaches these calculated levels
Note: The FourNineFour Rule is one of many technical analysis tools and should not be used in isolation. Always consider other factors such as market conditions, volume, and confirmation from other technical indicators before making trading decisions.