3 min read

Toll Brothers 78.6% Top in the making?

ONE44 Analytics where the analysis is concise and to the point

Our goal is to not only give you actionable information, but to help you understand why we think this is happening based on pure price analysis with Fibonacci retracements, that we believe are the underlying structure of all markets and Gann squares.

Here is a quick set of guidelines for the Fibonacci retracements to help with this article. You can find all the rules/guidelines and examples on any deviations from these four basic rules on our website.

1) The Golden rule, any market that is going to continue the current trend must hold 38.2% and a new high/low should follow.

2) Markets that are extremely strong/weak will only go 23.6% and a new high/low should follow. Typically a runaway market.

3) The 61.8% rule is, any market that holds 61.8% should go 61.8% of where it just came from. Usual happens when a market is directionless, or in a consolidation period.

4) The 78.6% rule is, any market that holds 78.6% should go 78.6% of where it just came from. This is also where a lot of Bull markets end and start.


This is just another example of how the ONE44 Fibonacci rules and guidelines can be used in ALL markets.

Starting with the low made on 3/18/20, once 38.2% of the break was taken out on 5/18/20, it told us the break was over and to start watching the retracements below to see if the trend was going to continue.

The first setback on 6/29/20 held 38.2% at 28.50, keeping the new trend intact and new highs followed. The next setback showed just how strong the market was when it could only get back to 23.6% at 39.20 on 9/4/20. This happened again after new highs were made, on 11/9/20 and again on 1/9/21, both lows held 23.6% to the March 2020 low.

When the market held 23.6% back to the March low, it was also 38.2% back to the 6/29/20 low. The market became so powerful that no setback got near 23.6% back to the March low and we then have to use higher up lows that stand out to retrace to.The most important was when it last held 23.6% on 11/9/20 and 1/9/21. Using this as the base the next three setback backs were retracements to it. The low on 3/4/21 held 38.2% and after new highs, it held 38.2% on 3/25/21. Then again after new highs the setback held 38.2% on 5/19/21. As the 38.2% rule says, it needs to go on to new highs to keep the trend strong. The next rally failed to make a new high and it fell just short of the 78.6% retracement. The 78.6% level is where a lot of bull runs end and start. The break there took it to 23.6% to the March low, on 6/24/21. The rally from it $5 before taking out 23.6%, another sign of weakness.

It is back above 23.6% and had a $10 move, however it is up against 78.6% at 65.10 and as mentioned it is where a lot of bull runs end. Also failing to make a new high after getting back above 23.6% is another negative sign. On a break from this area the first long term target will be 38.2% back to the March low, this is 47.50. As always we watch all the retracements on any move to see just how weak, or strong the market is, so if the break from 78.6% can only go back 38.2% at 60.00 the short term trend stays positive and a solid close above 65.10 should send it to new highs. The long term trend will remain positive until 38.2% of the move up from March is taken out.