How to use the Elliott Wave in Trading: Rules & Strategies

A classic chart, just as a great painting, will stand the test of time. Such is the case with the 100-year DOW chart Tony Caldaro posted here on the public blog on October 21, 2017. The chart reveals, like any masterpiece, many levels of information. Primarily, it shows his Objective Elliott Wave count for over 100 years of stock market price and time.

This is the first of two Elliott Wave Observations that are included in our indicator suite as they are measurable. We have provided automatic Wave 4 Pull Back Zones that measure the depth of the Wave. This is compared to that of the whole length of the 3rd Wave.

After things had started to calm down and stabilize around June of last year I fell into a crippling depression. For everyone who has been so supportive and sent me kind wishes I thank you. For those of you who threw hate, and assumptions (someone actually accused me of thinking I was above my father’s followers recently in an email smh) due to my lack of responses and participation. For those of you who threw the negativity at me, I hope you find peace and happiness for you are in desperate need of.


It reveals that mass psychology swings from pessimism to optimism and back in a natural sequence, creating specific and measurable patterns. This rule means that Wave 3 is always longer than at least one of the other two waves . Whilst this may seem complicated at first, these types of phases are much easier to understand once visualised on a chart . Expert market commentary delivered right to your inbox, for free.

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Using the Elliott Wave Principle is an exercise in probability. An Elliottician is someone who is able to identify the markets structure and anticipate the most likely next move based on our position within those structures. By knowing the wave patterns, you’ll know what the markets are likely to do next and what they will not do next.

The bottom of $1.35 looks like the Wave C local bottom. On the chart above you will see that the final wave 5 up is subdivided into three smaller waves instead of five waves as prescribed by the Classic Elliott Wave theory. On the chart above you can see that waves 1, 3 and 5 are composed of five smaller waves labelled as i, ii, iii, iv and v.

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In addition, the Elliott wave is not only limited to a bullish chart. The correction will also happen in a strongly bearish market where investors are selling certain instruments. As stated above, accentforex the key to understand a trend is to identify the trend. As a result, during times when the market is in a strong uptrend, there are times when the mood changes and traders begin to sell.

This information is presented for education purposes only. is not responsible for any comments, advice, or annotations presented on this page. Please review our Terms of Service for more details. hycm review No representation is being made that any account will or is likely to achieve profit or losses similar to those shown. Whether such trading is suitable for you in light of your financial condition.

I am thoroughly convinced that in contrast the main problem of the classic Elliott Wave theory is that it does not have enough rules and leaves too much for subjective interpretation. As I mentioned before, the only requirement the classic theory proposed for wave 3 is that it can not be the shortest. But that vague principle leaves a lot of room for alternative interpretations and let practitioners to come up with really ugly counts without formal violation of the official rules. In contrast, the corrective waves 2 and 4 have different structure. They are composed of only three smaller waves or “subwaves” a, b and c. In a five wave fractal pointing up waves 1,3 and 5 push price to new higher highs.

Within a corrective wave, subwaves A and C are usually smaller-degree impulsive waves. This means they too move in the same direction as the next larger trend. Note that because they are impulsive, they themselves are made up of five subwaves. Waves labelled with a B, however, are corrective waves; they move in opposition to the trend of the next larger degree.

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We start looking back at Bitcoin chart at the Wiseman Bullish divergent buy signal in […]… We are looking at Gold on the Daily chart to see where this market is in the Elliott Wave pattern. First, we examine the tallest peak on the PROFITUNITY AO which we have labeled as Wave 3/3 in August of 2020.

In conclusion, it is very important to note that using this strategy is not as simple as explained above. The fact is that it takes a lot of work, patience, and time to learn the strategy. Another important concept in Elliot Wave is known as degree. The idea of an Elliot Wave degree is based on the fact that there are usually smaller waves within the bigger wave. In the next third phase, more buyers come in and push the price higher.

Education is conducted in all the languages that our traders speak. Commodity and historical index data provided by Pinnacle Data Corporation. Unless otherwise indicated, all data is delayed by 15 minutes. The information provided by, Inc. is not investment advice. Trading and investing in financial markets involves risk. You are responsible for your own investment decisions.

Can wave 4 be a flat?

The center of Wave 3, normally has the steepest slope of the entire 5 wave structure, except perhaps the ‘kickoff’ of wave 1. Wave 2 will develop into a zigzag, flat, or combination. Wave 2 cannot be a triangle in its entirety. Wave 4 will develop into a zigzag, flat, combination, or Triangle.

The closer a market is to the end of a major pattern, the easier it is to predict. The information provided herein is for swiss bank forex general informational and educational purposes only. It is not intended and should not be construed to constitute advice.

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Get Elliott Wave and NEoWave TRAINING at our lowest price ever in this chapter-by-chapter review and explanation of Glenn Neely’s Famous book, Mastering Elliott Wave. This webinar series is personally presented by Glenn Neely. This is a good time to get some perspective on market action. View this FREE video course – “Neely River Trading” – by Glenn Neely. Just as Glenn Neely predicted, the current NEoWave structure is producing the best trading environment in more than a decade. In fact, 10 of our 12 positions are making money, with a 14-to-1 profit-to-loss ratio!

In addition, you can always define your trading strategy that suits your trading patterns. It’s also worth noting that the Elliott Wave Theory offers value to both short-term trade research as well as long-term strategies. However, due to their fractal nature, Elliott broke down and analyzed markets in detail far greater than Dow was able to. Fractals, it should be noted, are structures that infinitely repeat themselves as they get smaller, and Elliott discovered that the patterns of stock trading operated in the same manner. What this essentially meant for Elliott was that he could look at how these patterns repeated and then apply them as a predictive indicator.

In addition, Elliott noted that the market did not move in a chaotic manner but in an iterative manner. He also noted that group psychology moves back and forth from optimism to pessimism at diverse levels. This is your opportunity to learn Glenn Neely’s Neely River Trading Technology in a semi-private class. Get answers to this commonly asked question and FREE resources to learn more about NEoWave’s Trading service and Glenn Neely’s breakthrough Neely River Trading technology. Have you noticed that, in the trading industry, some folks exaggerate positive results, while downplaying any negatives?

So, despite the gap and go open, real conviction in buying stocks is not yet super evident. At some point, a major world event over the weekend and market players will awake Monday to a down-limit situation. I’m not saying that will happen this weekend, but at some point, it seems inevitable. It is not intended to be trading or investing advice. We do not recommend stocks to buy or sell, we provide a platform to assist you in making your own decisions. Our platform, analysis, and market data are provided ‘as-is’ and without warranty.

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Every major lasting decline of price for tradeable assets like stocks or commodities was interrupted by a counter trend move in opposite direction. In the US, the long-term count remains unchanged with the Super Cycle SC2 low in March 2009. Primary I concluded in mid-2015 with Primary II concluding in early 2016.

At times, the market instruments will be bullish and, at times, they will be bearish. When their price moves higher, they profit by buying the securities. If they believe that the price of the securities will move lower, they sell short.

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