Fifty Percent Principle

A principle that predicts that, before the observed trend continues forward, a price correction of approximately 1/2 to 2/3 of the change in price will occur.


Also known as a "one-half retracement," this correction is considered to be the normal course of up-trends as investors are initially weary and taking some profits.



Introduction to Technical Analysis - Here is an easy-to-understand tutorial on the various tools used in technical analysis, including moving averages, RSI, Bollinger bands, stock chart patterns, and much more.
Related Terms

Correction

EMA

Moving Averages

Retracement

SMA

Technical Analysis

Trend

Trend Analysis

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