Elliott Wave and Triangle
A triangle appears to reflect a balance of forces, causing a sideways movement that is usually associated with decreasing volume and volatility. The triangle pattern contains five overlapping waves that subdivide 3-3-3-3-3 and are labeled A-B-C-D-E. A triangle is delineated by connecting the termination points of waves A…[Read more]
Elliott Wave and Guidelines of Wave Formation
The guidelines presented throughout this chapter are discussed and illustrated in the context of a bull market. Except where specifically excluded, they apply equally in bear markets, in which context the illustrations and implications would be inverted.
The guideline…[Read more]
Elliott Wave Principle and Detailed Analytics
Motive waves subdivide into five waves and always move in the same direction as the trend of one larger degree. They are straightforward and relatively easy to recognize and interpret.
Within motive waves, wave 2 always…[Read more]
Wave Function and Elliott Wave
Every wave serves one of two functions: action or reaction. Specifically, a wave may either advance the cause of the wave of one larger degree or interrupt it. The function of a wave is determined by its relative direction. An actionary or trend wave is any wave that trends in the same direction as the…[Read more]
Elliott used the word “failure” to describe a situation in which the fifth wave does not move beyond the end of the third. We prefer the less connotative term, “truncation,” or “truncated fifth.” A truncation can usually be verified by noting that the presumed fifth wave contains the necessary five subwaves, as illustrated in Figures…[Read more]
All waves may be categorized by relative size, or degree. Elliott discerned nine degrees of waves, from the smallest wiggle on an hourly chart to the largest wave he could assume existed from the data then available. He chose the names listed below to label these degrees, from largest to smallest:
Grand Supercycle Supercycle Cycle…[Read more]
Planning your exit
Since no human can see into the future, unfortunately new and experienced traders alike will sometimes have to contend with losing trades.
Emotions can run high at these times. Watching your hard-earned money being depleted from your account is an uncomfortable experience – and it can compromise your decision-making…[Read more]