# Practical use of Elliott Wave analysis



## tech/a

Ive often said I only use Elliot as a guide to where a trade I'm taking is in the life of a move in an instrument. Ive found it particularly helpful at MAJOR turning points when I can see many of the stocks making up an index displaying very similar counts.

Some have shown an interest in gaining some knowledge and some here like Boggo are well versed.

Here is an excerpt from Robert Proctor.

*Click to enlarge*




Here is the whole interview if interested.

http://www.elliottwave.com/freeupda...-You-ll--Get--the-Elliott-Wave-Principle.aspx

The best book Ive found on the topic is.

Dynamic Trading 
Robert Miner
ISBN 0-934380-83-x


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## KurwaJegoMac

*Re: Practical use of Elliot analysis.*

Thanks for sharing Tech/a,

Regarding 'Dynamic Trading' - does it cover the content found in 'Elliot Wave Principal' by Frost & Prechter or is it an extension of the 'Elliot Wave Principal' topics?

I have not read much on EW, save for some snippets in Nick Radge's Adaptive Analysis as well as some of your posts. So I can be assumed to have zero knowledge - therefore which book(s) would you recommend I read/start with?

Do you ever use EW for determing your entry or exit points or merely to determine the approximate stage/lifecycle of your trade to minimise getting into a trade too late/early? 

Currently I trade a very simple breakout with stops at key resistant levels. It's a very simple system but I'm happy with the results so far (i've only been involved with the sharemarket for 3 years). Obviously i'd like to tweak and improve the system for better performance and I'm considering using EW to use an indicator of whether i'm entering a stock too late in a move. Have you found it reliable/works well with your breakout strategy?

Thanks.


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## Whiskers

*Re: Practical use of Elliot analysis.*

I don't think Pretcher is entirely right claiming market analysis is and must be a science, not an art.

Certainly while scientific methods are important for discerning the data, my understanding of Elliott's theory was he had an art (skill in conducting any human activity) to interpreting the data... to work through different posibilities of wave counts. 

For me science is a systematic knowledge of the physical or material world gained through observation and experimentation. 

I tend to believe art is the skill of utalising that historic scientific data for future purposes. 

If the market analysis was just scientifically predictable from the data, wouldn't there be many 'scientists' accurately predicting the markets?


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## Sean K

*Re: Practical use of Elliot analysis.*

Great thread tech, but it's going to end in an argument I feel.

I am a searcher open to all ideas and ways to be a better trader/investor.

But,

Please show us some consistent, live, EW buy and sells on top of the initial analysis. 

For your theory to be proved, put up the initial analysis (presumedly basic TA) with the EW overlaid, and how it confirms your TA.  

'Live' as in before the fact. 

Radge started doing this at one point some time ago and when we began keeping track he bailed. Like, totally spit the dummy. Wasn't up for scrutiny. Even though he was supposed to be sharing analysis.



Whiskers said:


> I don't think Pretcher is entirely right claiming market analysis is and must be a science, not an art.



YES, How can anything be a 'science' when it isn't correct until after it's unfolded and is not repeatable?

My prediction is that when EW is used as a trading trigger this thread will die a horrible death. 

Looking forward to be proved very very wrong.

I do say again, I WANT THIS TO WORK. SHOW ME.


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## tech/a

*Re: Practical use of Elliot analysis.*

Kennas

My use is as *an adjunct* to my analysis.

I use *other analysis to confirm.*
In particular with the index as Broadway also pointed out--- when other stock in the index also show the very same or very similar counts.

Now for live showings
Have a look at the PEN thread post 1004 called way way before it occurred the count then was the same as this chart.




If you then go to the XAO thread you'll see that I posted the chart (Elliot) on the 22/02 (I think) way way before the "Correction."

If you also go back to 2007 I also called that with charts and I also called that at 6000 that also wasn't the top with "Evidence" There is a whole thread on it---I was ridiculed--Par for the course-- on that as well.

Now that we have that out of the way lets look at 
*THIS CHART*






The current XJO
Im long on a group of stock and expecting trading to 4650 to 4750 before the last leg down to wave 5 is underway.
This is likely to be a corrective phase which will take a while as wave 2 was very quick.I would/will be looking for a triangle type correction before the final thrust down.

Analysis on individual stocks will see me sell or hold.

*Finally*
I'm not here to prove Elliot Wave analysis.
I'm certainly NOT A PURIST--I'm NOT and EXPERT (I dont think you have to be) I have found a way to use it and trust it in my trading. I'm just passing it on to those interested. I cheat because I use Advanced Get to count the waves---while I can hand count ---Aget is far quicker.

The fun begins when the wave counts alter and when that happens I will try and help those struggling with the concept of dynamic wave counts so that it is no longer a problem but an expected occurrence in this analysis which helps further to understand where we are in a trade or prospective trade.

I'm not going to argue for it but work through charts--those that follow can---those that cant get their head around it or find no use in it can trade as they have before---without it.


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## Garpal Gumnut

*Re: Practical use of Elliot analysis.*

Elliot makes more sense, as it follows Fibonnaci's reasoning, than most hair brained black boxes out there, and you can do it yourself. 

It works well for long term analysis.

gg


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## wayneL

*Re: Practical use of Elliott analysis*

I worked for a firm researching EW a few years ago. I didn't see anything with a higher probability than other analyses. 

It can be made to work with standard risk control and money management, but there is no inherent edge there IMO.

Too subjective.


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## tech/a

*Re: Practical use of Elliott analysis*



> Too subjective.




I find that (Its fluid subjectivity) a very strong plus for the analysis.


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## barney

*Re: Practical use of Elliot analysis.*



tech/a said:


> *I'm not going to argue* for it but work through charts--those that follow can





Also not looking for EW arguments as they generally serve no purpose. I have a basic understanding of the mechanics, but don't make trades using it.

With that in mind *tech* ...... As you know I hold PEN so it is of particular interest to me.  Couple of questions for discussion.

Using EW, would we be looking for a further 2 waves to the downside to complete the 5 wave down sequence?  If so, do you have a projected SP?

Or ......  does the current abc pattern most likely represent the full extent of the downside spike, and if so, why?

Obviously PEN is a slightly different scenario due to the change in recent fundamental world events.  That being the case, does the previous price action to this point hold less relevance, and do we/don't we re-start the EW counts from the current SP? 

As I say, questions are for discussion and interest only .......... Cheers.


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## tech/a

*Re: Practical use of Elliott analysis*

Happy to use PEN as a point of discussion.
I hold PEN now at .078 (I think) I expect this to be a wave 4 in the current move and expect price to rise to around 10c I will be looking for signs of weakness at around these levels with VSA--when I see them Ill be out. 
This for me is a short term risky trade of wave 4.
Followed by a lower wave 5 ending at around the wave 3 mark or lower.
Too early to call. It depends on how deep the wave 4 ends up.


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## mazzatelli

*Re: Practical use of Elliot analysis.*



Whiskers said:


> I don't think Pretcher is entirely right claiming market analysis is and must be a science, not an art.
> 
> Certainly while scientific methods are important for discerning the data, my understanding of Elliott's theory was he had an art (skill in conducting any human activity) to interpreting the data... to work through different posibilities of wave counts.
> 
> For me science is a systematic knowledge of the physical or material world gained through observation and experimentation.
> 
> I tend to believe art is the skill of utalising that historic scientific data for future purposes.
> 
> If the market analysis was just scientifically predictable from the data, wouldn't there be many 'scientists' accurately predicting the markets?




And you don't think selecting the right parameters, models and diagnostics to measure price or vol scientifically doesn't require subjective calls or "art" as you would call it?

Always funny to see non mathematicians/statisticians speak of financial mathematics as if everything derived is of a deterministic nature.


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## professor_frink

*Re: Practical use of Elliott analysis*

Hi tech,

I have a couple of questions in regards to the way that EW is applied. Whilst I can fully appreciate that counts evolve over time, the actual application of this side of things has me a little lost.

A couple of examples to illustrate my issues with it:

From July 2009:

On the 10th July:



tech/a said:


> XAO
> 
> You'll notice that many patterns mimick the index.
> This has occured at most times where a *confluence* in price action in many other stocks preceeds longer term moves.
> 
> In the major downturn many stocks were in stage 5 of 5 Elliott counts as was the Index.
> Ive noticed when there are a number of stocks displaying similar counts its a MONTE!
> 
> This is likely to be similar.




This opinion you've expressed above ties in with the chart you posted in the XAO analysis thread(post 6565), which was labelling that current correction as the start of a wave 5 down to new lows in the context of the 07-08 bearmarket.


And then at the end of that month you highlighted that the 14th of July was the end of an ABC correction:



tech/a said:


> You could have been long from the bottom of the ABC corrective move
> I have been since 14/07/09 and its been a very good 2 weeks.
> Initial target for this move is 4388 which seems to be close to other types of analysis targets.




So based on what you've said in those posts, the count has obviously changed in those 2 trading days, but what I can't wrap my head around completely is where a count can change so drastically, from a new leg down in a once in a generation bear market to a small ABC correction in an ongoing rally.

What are the triggers that can change a count so drastically, and how would it be applied in real time?


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## tech/a

Prof

Ill answer tonight as all my Elliott software is home.


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## bbker

*Re: Practical use of Elliot analysis.*



tech/a said:


> Now that we have that out of the way lets look at
> *THIS CHART*
> 
> 
> View attachment 41965
> 
> 
> 
> The current XJO
> Im long on a group of stock and expecting trading to 4650 to 4750 before the last leg down to wave 5 is underway.



Don't you mean "UP to wave 5"? 
(since wave 5 descends)


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## wayneL

*Re: Practical use of Elliot analysis.*



bbker said:


> Don't you mean "UP to wave 5"?
> (since wave 5 descends)




Impulse wave 5 is upwards.


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## Boggo

I think I could have a comment/input to every post on this thread so far if I had the time right now but I don't today.
Good commonsense questions are being asked and responded to, lets keep it running smoothly.



tech/a said:


> Ive often said I only use Elliot as a guide to where a trade I'm taking is in the life of a move in an instrument. Ive found it particularly helpful at MAJOR turning points when I can see many of the stocks making up an index displaying very similar counts.



I agree 100% with tech/a on this, this is where EW is really valuable I believe.
I have quickly grasped an example to chart below, there are better and many similiar examples but this is a recent one.



KurwaJegoMac said:


> Thanks for sharing Tech/a,
> 
> Regarding 'Dynamic Trading' - does it cover the content found in 'Elliot Wave Principal' by Frost & Prechter or is it an extension of the 'Elliot Wave Principal' topics?
> 
> Do you ever use EW for determing your entry or exit points or merely to determine the approximate stage/lifecycle of your trade to minimise getting into a trade too late/early?
> 
> Currently I trade a very simple breakout with stops at key resistant levels. It's a very simple system but I'm happy with the results so far (i've only been involved with the sharemarket for 3 years). Obviously i'd like to tweak and improve the system for better performance and I'm considering using EW to use an indicator of whether i'm entering a stock too late in a move. Have you found it reliable/works well with your breakout strategy?




Dynamic Trading by Robert Miner is the book in my opinion (all 1.73kg of it !!), straight to the point with practical everyday examples of how the process can be used without getting bogged down in theory.

The charts below are two of ELM which is a stock that came up in my system last night and it was also being discussed somewhere else on this site last night.

The process to answer your last two paras...

ELM chart 1 below - potential breakout - at resistance - if it breaks out will resistance become support - where is the entry - where is the stop - what is the target - is it even worth considering.

ELM chart 2 below - three waves complete - W.4 complete on breakout ? - is it playing by the rules - yes, W.3 made target - where to now - what is W.5 min and max target - what is R/R at min target.

Is it a potential candidate still ??  process complete, next.

Chart 1 and 2 (click to expand)


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## tech/a

*Re: Practical use of Elliot analysis.*



wayneL said:


> Impulse wave 5 is upwards.




In the case specifically in question this is a 5 wave impulse move DOWN
I expect that within the wave 4 we will see an ABC corrective move which could form a triangle pattern --common in wave 4s


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## Garpal Gumnut

And do not ever forget, even with EW.

The golden advice for all muppets.


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## Sean K

Boggo said:


> I have quickly grasped an example to chart below, there are better and many similiar examples but this is a recent one.
> 
> Dynamic Trading by Robert Miner is the book in my opinion (all 1.73kg of it !!), straight to the point with practical everyday examples of how the process can be used without getting bogged down in theory.
> 
> The charts below are two of ELM which is a stock that came up in my system last night and it was also being discussed somewhere else on this site last night.
> 
> The process to answer your last two paras...
> 
> ELM chart 1 below - potential breakout - at resistance - if it breaks out will resistance become support - where is the entry - where is the stop - what is the target - is it even worth considering.
> 
> ELM chart 2 below - three waves complete - W.4 complete on breakout ? - is it playing by the rules - yes, W.3 made target - where to now - what is W.5 min and max target - what is R/R at min target.
> 
> Is it a potential candidate still ??  process complete, next.
> 
> Chart 1 and 2 (click to expand)



Boggo great to see some live charts.

(Must say though, a book published x number of years ago is hardly live application. I could do that with any system in retrospect)

On ELM Chart 2, it looks interesting but your W3 and 4 look pretty shaky to my untrained eye. 

Won't we only know that they are 3 and 4 after its broken 3? And even then, the 4 is not lower than the Feb 25 low. Does that still fit the EW rules?


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## tech/a

*Kennas*.

Your doing a good job controlling your skepticism.

Boggo has come close in his labelling.(Hope you dont mind Boggo)
A GET's is a little closer I think.
You are correct that after todays trading wave 4 is confirmed and wave 5 now appears.
It cannot be said that we have an end to wave 5 yet. It is still dynamic until we see a corrective move to end.
Aggressive traders could see this pivot reversal on low volume as a turning point

Click to expand




PEN the one we have been following seems to have run its race for the time being
remember I now expect this to develop into a consolidation pattern before finalizing its move down to wave 5---I think its traded at its highest now for a good while.
I traded this from 7.8c to 10.5c short and sweet.

Click to expand


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## Boggo

Boggo said:


> I have quickly grasped an example to chart below, there are better and many similiar examples but this is a recent one.




As I mentioned it was just a quick glance and manual plot, more an attempt to explain how EW can be used in this case with a breakout rather than a perfect example of EW.
PEN and both the XAO and XJO are better examples maybe of where 5 waves have played out and a correction is now abiding by the rules.
There are numerous charts in this situation at the moment.



kennas said:


> Boggo great to see some live charts.
> 
> (Must say though, a book published x number of years ago is hardly live application. I could do that with any system in retrospect)



There are probably better examples being covered over the last few weeks on the XAO and PEN threads.
The reference to the book was never intended to be an example, it was a response to a query in post 2 of this thread.



kennas said:


> On ELM Chart 2, it looks interesting but your W3 and 4 look pretty shaky to my untrained eye.
> 
> Won't we only know that they are 3 and 4 after its broken 3? And even then, the 4 is not lower than the Feb 25 low. Does that still fit the EW rules?




It is a bit untidy, W.4's usually are and in this case the W.4 I plotted didn't make it down to a 38.2 retracement, as I mentioned above it was a rushed example attempt to display how it can be used to answer the query in post #2.




tech/a said:


> *Kennas*.
> 
> Your doing a good job controlling your skepticism.
> 
> Boggo has come close in his labelling.(Hope you dont mind Boggo)
> A GET's is a little closer I think.




Thanks tech/a, I always prefer that these are pointed out and I always like a second opinion.
The interesting bit is that MTPredictor auto routine won't plot either selection as a W.4 because (I suspect) neither retrace W.3 by 38.2, the ideal minimum retracement, it still has it in a W.3 with a minimum W.4 retracement target of $1.75 from today's high.

I have always thought that Kennas was a closet EW purveyor anyway


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## tech/a

> I have always thought that Kennas was a closet EW purveyor anyway




Likes the analysis has seen it applied often enough to see its use---but cant get his head around how to use/apply it.

He's not alone---the ever changing wave counts  (During recent price action) frustrates the hell out of those who cant work with fluid motion.
Yet once you understand it--its the easiest thing since learning how to walk.


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## wayneL

tech/a said:


> ...those who cant work with fluid motion.



Eh?

Last time I looked, price action is the same whether or not an EW count is applied, ergo we all work with "fluid motion" in one way or another (with varying degrees of success).

ANY method is about your oft quoted and oft bolded APPLICATION. I'll bet even Gann can be applied successfully.... even indicators .

Speaking of Gann, your post here was rather Gannesque in its "you don't undersatnd", when all Kennas was asking was a demonstration of application in real time rather than a hundred calls, one of which will look prophetic in hindsight.


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## ginar

wayneL said:


> Eh?
> 
> Last time I looked, price action is the same whether or not an EW count is applied, ergo we all work with "fluid motion" in one way or another (with varying degrees of success).
> 
> ANY method is about your oft quoted and oft bolded APPLICATION. I'll bet even Gann can be applied successfully.... even indicators .
> 
> Speaking of Gann, your post here was rather Gannesque in its "you don't undersatnd", when all Kennas was asking was a demonstration of application in real time rather than a hundred calls, one of which will look prophetic in hindsight.





dejavu with me also wayne , i see EW about as useful as gann . Yet to see one mainstream EW practitioner get a decent handle on market , all this predictive rubbish has scam written allover it . im sure tech is going to point out his xao musings to us all now and tell us how good we arent . hows that for prediction


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## professor_frink

*Re: Practical use of Elliott analysis*



professor_frink said:


> Hi tech,
> 
> I have a couple of questions in regards to the way that EW is applied. Whilst I can fully appreciate that counts evolve over time, the actual application of this side of things has me a little lost.
> 
> A couple of examples to illustrate my issues with it:
> 
> From July 2009:
> 
> On the 10th July:
> 
> 
> 
> This opinion you've expressed above ties in with the chart you posted in the XAO analysis thread(post 6565), which was labelling that current correction as the start of a wave 5 down to new lows in the context of the 07-08 bearmarket.
> 
> 
> And then at the end of that month you highlighted that the 14th of July was the end of an ABC correction:
> 
> 
> 
> So based on what you've said in those posts, the count has obviously changed in those 2 trading days, but what I can't wrap my head around completely is where a count can change so drastically, from a new leg down in a once in a generation bear market to a small ABC correction in an ongoing rally.
> 
> What are the triggers that can change a count so drastically, and how would it be applied in real time?




Bump...


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## luke256

ginar said:


> Yet to see one mainstream EW practitioner get a decent handle on market , all this predictive rubbish has scam written allover it.




A lot of those EW practioners are using it only to forcast rather than intergrate it into a practical trading system. 

Example: If your software shows a wave 4 retracement then you should trade when it shows the trend has turned back up. Don't just buy the first time the program flashes "WAVE 4". IMO EW works best when you have a mechanical entry after the price moves up from the specified retracement level.


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## professor_frink

luke256 said:


> A lot of those EW practioners are using it only to forcast rather than intergrate it into a practical trading system.
> 
> Example: If your software shows a wave 4 retracement then you should trade when it shows the trend has turned back up. Don't just buy the first time the program flashes "WAVE 4". IMO EW works best when you have a mechanical entry after the price moves up from the specified retracement level.




If that is the case, then why bother with EW at all? Just wait for a higher low to form and then start buying the minor breakouts of the dips


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## tech/a

*Re: Practical use of Elliott analysis*



professor_frink said:


> Bump...




Sorry Prof

I forgot about this question
Im out to dinner tonight but should get sometime to refresh my analysis and explain.


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## professor_frink

*Re: Practical use of Elliott analysis*



tech/a said:


> Sorry Prof
> 
> I forgot about this question
> Im out to dinner tonight but should get sometime to refresh my analysis and explain.




no worries tech


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## tech/a

*Re: Practical use of Elliott analysis*



professor_frink said:


> no worries tech




I can *clearly* see the issue.

Had a bit of a look over it (your specific charts and dates) to familiarise myself again.
Its a good question Prof and one 90% of people ask and it wasnt handled at all in the exchange at the time.

It will be important for all those who are not familiar with Elliott (Infact all technical analysis) to have a clear concise answer which everyone can understand.

I *WILL* actually be able to deliver that sometime tonight.
It should help many--not only with Elliott but with *ALL* analysis.


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## luke256

professor_frink said:


> If that is the case, then why bother with EW at all? Just wait for a higher low to form and then start buying the minor breakouts of the dips




I find it useful to use the EW structure to see the markets position. If it was in the process of a wave 4 retracement, i'd be waiting for a signal to go long and would not take short trades. That way i'm am trading with the main trend. One the other hand if the EW was indicating another move down i wouldn't be looking to buy on the dips.

I find the EW ties in well with Gann's 'sections of the market'. Gann said that bull markets generally have 3 to 4 up sections. I can easily see the sections on my software using EW tool.


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## professor_frink

luke256 said:


> I find it useful to use the EW structure to see the markets position. If it was in the process of a wave 4 retracement, i'd be waiting for a signal to go long and would not take short trades. That way i'm am trading with the main trend. One the other hand if the EW was indicating another move down i wouldn't be looking to buy on the dips.
> 
> I find the EW ties in well with Gann's 'sections of the market'. Gann said that bull markets generally have 3 to 4 up sections. I can easily see the sections on my software using EW tool.




you've basically just repeated your earlier post without answering my question. 

It's perfectly reasonable to want to trade with the main trend.

My point was that by the time the market gets to the point where it would be labelled a wave 4, it's blindingly obvious that the market is in an uptrend and that in order for you to continue trading with the trend the next one you take should be long.

EW used in this context is a fairly pointless exercise.


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## Boggo

luke256 said:


> If it was in the process of a wave 4 retracement, i'd be waiting for a signal to go long and would not take short trades.
> I can easily see the sections on my software using EW tool.




Definitely no short trades at W.4, however W.5 is a different story and that point can be predicted (see XAO banter thread), but to know where W.5 is you need all the steps up to it.

Quite often you see the W.4 and then everyone jumping in on the breakout with the resumption of the (soon to correct itself) trend.
Look at IGO on the XAO Banter thread, there was 49c in W.5 if you nailed it perfectly without slippage or fees.

The trend is one thing, don't fight it, but you need to know more about where you are in the smaller picture than what a long term EMA may provide.
(you may note that there is a shorter term 34 period EMA on most of my charts)

What do you make of this one luke256, it may be one that you like ?
(click to expand)


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## Boggo

professor_frink said:


> My point was that by the time the market gets to the point where it would be labelled a wave 4, it's blindingly obvious that the market is in an uptrend and that in order for you *to continue trading with the trend the next one you take should be long*.
> 
> EW used in this context is a fairly pointless exercise.




So would you have gone long on IGO based on that theory just because its in an uptrend ?
Not disagreeing with you, just wondering how you determine that the correction is complete and a new uptrend has resumed and where you might enter.


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## professor_frink

Boggo said:


> So would you have gone long on IGO based on that theory just because its in an uptrend ?
> Not disagreeing with you, just wondering how you determine that the correction is complete and a new uptrend has resumed and where you might enter.




IGO??


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## Boggo

Boggo said:


> Quite often you see the W.4 and then everyone jumping in on the breakout with the resumption of the (soon to correct itself) trend.
> Look at IGO on the XAO Banter thread, there was 49c in W.5 if you nailed it perfectly without slippage or fees.




IGO used as an example in previous post above.


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## mytoniix

tech/a said:


> I *WILL* actually be able to deliver that sometime tonight.
> It should help many--not only with Elliott but with *ALL* analysis.




If its not too much to ask...
Could you take us through comprehensively the other analysis' so I can get a clearer picture on how you use EW in your decision making process.


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## professor_frink

Boggo said:


> IGO used as an example in previous post above.




I'm gathering you are talking about a stock code here The one above is PRR?

If you are talking about an individual company I wouldn't have a clue, I mainly trade indices.

Feel free to point out an index and I'll throw an opinion out there for it.

*EDIT:* sorry Boggo, I just saw the edit you made on the post. Will go and have a look


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## Boggo

professor_frink said:


> I'm gathering you are talking about a stock code here The one above is PRR?
> 
> If you are talking about an individual company I wouldn't have a clue, I mainly trade indices.
> 
> Feel free to point out an index and I'll throw an opinion out there for it.
> 
> *EDIT:* sorry Boggo, I just saw the edit you made on the post. Will go and have a look




Sorry Prof, not very clear on my part, trying to do about six things at once here.
The point I am trying to make is that there is a definite advantage in knowing where any tradeable instrument is in its cycle and I was using the IGO chart on another thread as an example of where you can get caught out by expecting the uptrend to just resume and repeat itself.
Cheers.


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## professor_frink

Boggo said:


> So would you have gone long on IGO based on that theory just because its in an uptrend ?
> Not disagreeing with you, just wondering how you determine that the correction is complete and a new uptrend has resumed and where you might enter.




It's a little hard to say with any kind of precision, I don't have data for IGO, know what sector it's in, etc.

The end of that W4 in the IGO chart looks to me to be pretty well around the time I was talking about getting long the ES(here), so it's a possibility.

I've shown a few examples of type of analysis I do in this thread if you are interested in the types of signals I take:

https://www.aussiestockforums.com/forums/showthread.php?t=20000

If you want some relevant examples of the types of entries of I take then I'll go and dig up some past posts from the past 6 months and highlight them in a chart later tonight.

I really have no business commenting on the IGO chart with any kind of credibility. I'd never even heard of it before today


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## professor_frink

Boggo said:


> Sorry Prof, not very clear on my part, trying to do about six things at once here.
> The point I am trying to make is that there is a definite advantage in knowing where any tradeable instrument is in its cycle and I was using the IGO chart on another thread as an example of where you can get caught out by expecting the uptrend to just resume and repeat itself.
> Cheers.




hang on mate, you've lost me again

 I thought you mentioned the 4th wave in IGO, I assumed you were talking about the dip at the end of last year before it run up to it's high in February?


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## Boggo

OK, this was your statement in response to luke256.



professor_frink said:


> My point was that by the time the market gets to the point where it would be labelled a wave 4, it's blindingly obvious that the market is in an uptrend *and that in order for you to continue trading with the trend the next one you take should be long*.




My comment is that just because it is in an uptrend doesn't always mean that you just blindly jump on at the next upturn or breakout without first knowing where you are in the life of any entity.
In this case IGO is being used just as an example, you don't have to be familiar with IGO, the pattern principle is the same.



professor_frink said:


> EW used in this context is a fairly pointless exercise.




I disagree, EW is a very valuable asset, in this case it would have made you think twice about just buying at some point.
The "some point" is also an area of interest, do you know that the W.4 is possibly finished and you buy on the pivot turn or do you wait for confirmation on the breakout.
Where would you enter (re-enter) this last up leg, ie. where would *"the next one you take"* be taken by you ?
Cheers

(click to expand) 
(the yellow box is plotted by the software as its expected minimum W.5 based on the current pattern)


----------



## Sean K

tech/a said:


> *Kennas*.
> 
> Your doing a good job controlling your skepticism.
> 
> Boggo has come close in his labelling.(Hope you dont mind Boggo)
> A GET's is a little closer I think.
> You are correct that after todays trading wave 4 is confirmed and wave 5 now appears.
> It cannot be said that we have an end to wave 5 yet. It is still dynamic until we see a corrective move to end.
> Aggressive traders could see this pivot reversal on low volume as a turning point



Always controlled Tech. 

That chart looks more logical, yes. Must be the time selected?

Although my charts look like boggo's. 

Still no entry and exit based on EW though.

I do see that some are using it in conjunction with other TA. 

Can EW be traded in isolation with no other basic TA factors to consider. Like S&R?


----------



## Boggo

kennas said:


> Can EW be traded in isolation with no other basic TA factors to consider. Like S&R?




Difficult to do so in the current market kennas, mainly because of the gaps that can occur between days and weeks at the moment, a lot of setups get stopped out with one bad night in Japan or the Middle East.

Continuous markets such as forex and futures still seem to be tradeable as before.

A few years ago when the market was more consistent it was easy to use especially on the top 200 as they were consistent.

Hit and run breakouts have been much better for me this year but EW is definitely a big help with these too in examples as described in relation to IGO and the indices which tech/a could not have predicted so accurately without EW.


----------



## doctorj

Is anyone aware of any (successful?) hedge funds that use Elliott Wave to take trading decisions? If they don't exist, or they're not relatively common, why not? I'm just having trouble with the application of it in real time. I can see that it seems possible to give charts a nice wave count historically, but anecdotally the number of times I see changes to the count that invalidates earlier counts makes me wonder if it is information or just noise. So back to my original question, if it has information value, hedge funds will use it...


----------



## professor_frink

Alright I've some data taken from yahoo and know what they do now.

The reversal bar you've tagged as the W4, was the exact date I highlighted to you earlier about throwing a bid out for the ES. The day before that the dip was slowing up along with a run of down days, and was near a 20 day low within the context of an existing uptrend, it had taken an appropriate amount of time to get there, so I may have been long the close the day before and adding to it on the gap down on the 17th. 

Half position scale out on the 3rd of December, and flat on the close of the 6th of January based on a trailing stop.

 I know you are probably looking for something more concrete than that, but I've never been able to look at 1 single stock code and form a tradeable  opinion on it. I have absolutely no intention of trying to acquire clean data on an entire sector of companies to run anything more in depth for a theoretical exercise on a forum. Sorry.

Just on some of your other points:



Boggo said:


> OK, this was your statement in response to luke256.
> 
> 
> 
> My comment is that just because it is in an uptrend doesn't always mean that you just blindly jump on at the next upturn or breakout without first knowing where you are in the life of any entity.




Personally I don't like waiting for price to confirm my opinion before entering. R:R gets skewed against me and it can lead to buying just before price rolls back over again. When there is confirmation of my trading idea via the price in whatever I'm trading, then I'm profiting off it, not still planning my entry. If I'm going to be wrong on a trade, I want a fairly tight stop and I want to know as quickly as possible so I can have capital deployed elsewhere. 



Boggo said:


> I disagree, EW is a very valuable asset, in this case it would have made you think twice about just buying at some point.




You mean like my well timed ES long last Monday morning(the 14th)

Whilst we are looking at  Elliot Wave, anyone interested can have a look at the the way people were talking about the market last July in the XAO analysis thread. Our market bottomed in May, over a month later, most people were calling for new lows. It wasn't until the start of September where you highlighted that "the goalposts have moved"

That's over 70 trading days out and nearly 400 points from the low print. IMO EW is a tool just like any other and prone to the random gremlins that put us all on the wrong side of the market at certain points in time.


----------



## tech/a

Kennas

I dont think anyone here would attempt to use or want to use *ANY* form of analysis in isolation. Ive already made it clear why and how I apply Elliott to any trade.

I'm sure Luke and Boggo are very similar.

To Profs question specifically.

We can only analyse a chart at any given point of time.
The analysis will be proven correct or in correct.
It gives us a point at which to start or reject a trade.
Ive put Elliott in Training mode so I can work through this in very simplistic form ---Im not going to look at every wave and its structure as it suffices to simply understand that until Proven otherwise a count will evolve.
So if you had been short you would have been stopped with a new high.
Your analysis would have then been similar to that which I am now presenting I have no choice but to do this in hind site as its already passed.
The analysis still stands at the time.





Prof the analysis as you will see altered and as such when I looked at the daily I made it clear I thought then in the post as I'm trying to make it clear now.
The 2 charts are vastly different in count because one is weekly and the other daily.

Wave counts are to be used in my view as a guide to where we are in a chart and in conjunction with other analysis.

So going forward we have this.
It did in fact reach the 50% level.
You / I would be reluctant to place long term long trades from here in.




Which brings us to today.




Now I like everyone here likes as close to possible to R/T analysis and application.
PEN is one we are following and the XJO in daily as well.
Is that enough or is it still not coming a little clearer?
Is this helpful?


----------



## Boggo

professor_frink said:


> IMO EW is a tool just like any other and prone to the random gremlins that put us all on the wrong side of the market at certain points in time.




Yep, most definitely. Unfortunately it is difficult to grasp, requires a lot of effort to "see" what it is telling you and can be very frustrating sometimes.

Most of the critics seem to reach a similiar level of familiarity with it (a little bit of knowledge is dangerous) and then quietly give up or otherwise they put more effort into being critics than they have trying to understand it.

Below is an experiment where I put money on the line and stuck to the EW W.2 setup that came up in MTPredictor. 
I was slow to enter, got in at 0.245 and stayed put until I got out at 0.40 when the low took out the low of the W.4 of the fifth wave (Robert Miner - Dynamic Trading procedure).

It was painful to endure because it was so erratic after W.2, I remembered Nick Radge's comment that "the market always closes gaps" during W.4 closing the W.3 gap, I backed my stop off to allow for that (it actually closed the gap perfectly).
I would have had an ulcer if I had the house riding on it but it worked eventually and erratically.

It was was a worthwhile and profitable experiment and MNC has got my interest now again... Why ?

I have highlighted the entry and exit.
(click to expand)


----------



## tech/a

Prof

Found this










Then if you have a look at posts 8326/27 and 30 the goal posts moved in a few days.

Anyway the whole Idea is to help those interested in using Elliott in their analysis.
So will watch those charts posted and will comment.
I will also include other analysis as it supports the Elliott component.


----------



## the phantom

In my opinion, EW is a con.

Don't need it, will never need it.

Same with fibonacci levels.

Btw, I do subscribe to T/A, but not this voodoo


----------



## tech/a

the phantom said:


> In my opinion, EW is a con.
> 
> Don't need it, will never need it.
> 
> Same with fibonacci levels.
> 
> Btw, I do subscribe to T/A, but not this voodoo




Yes I was exactly the same.

Then I took the time to understand it and get my head around the moving wave counts,actually understood how and why.

Its been an valuable technical tool ever since.
For many they will remain as I was and you are.
But a few will find it valuable.


----------



## professor_frink

tech/a said:


> Prof
> 
> Found this
> 
> View attachment 42019
> 
> View attachment 42020
> 
> View attachment 42021
> 
> View attachment 42022
> 
> 
> Then if you have a look at posts 8326/27 and 30 the goal posts moved in a few days.
> 
> Anyway the whole Idea is to help those interested in using Elliott in their analysis.
> So will watch those charts posted and will comment.
> I will also include other analysis as it supports the Elliott component.




tech in that post where you highlighted that there was "now a possibility that there will be an alternate wave count toward 4600", the market was already above 4500, it had been rallying for a couple of weeks and was almost there already.

The posts 8330 you highlighted was the one I was referring to in my earlier post, it was early September when those posts were made.



tech/a said:


> To Profs question specifically.
> 
> We can only analyse a chart at any given point of time.
> The analysis will be proven correct or in correct.
> It gives us a point at which to start or reject a trade.
> Ive put Elliott in Training mode so I can work through this in very simplistic form ---Im not going to look at every wave and its structure as it suffices to simply understand that until Proven otherwise a count will evolve.
> So if you had been short you would have been stopped with a new high.
> Your analysis would have then been similar to that which I am now presenting I have no choice but to do this in hind site as its already passed.
> The analysis still stands at the time.
> 
> 
> 
> 
> Prof the analysis as you will see altered and as such when I looked at the daily I made it clear I thought then in the post as I'm trying to make it clear now.
> The 2 charts are vastly different in count because one is weekly and the other daily.
> 
> Wave counts are to be used in my view as a guide to where we are in a chart and in conjunction with other analysis.
> 
> So going forward we have this.
> It did in fact reach the 50% level.
> You / I would be reluctant to place long term long trades from here in.
> 
> 
> 
> Which brings us to today.
> 
> 
> 
> Now I like everyone here likes as close to possible to R/T analysis and application.
> PEN is one we are following and the XJO in daily as well.
> Is that enough or is it still not coming a little clearer?
> Is this helpful?




Actually I'm getting more confused. You just said that you would have been stopped out with a new high, but with the quotes I highlighted earlier, you flipped in the space of 2 days. I've highlighted them below on a chart so that it's perfectly clear.




This was what I was after an explanation of. You went from saying that the next move down was likely to be a "MONTE", then flipped your position to long 2 days later.

Now I know that any single trade is essentially a coin flip and will ultimately be proven right or wrong as time goes by and price develops. What is the trigger for a wave count changing so suddenly though?

IMO it's these kinds of flip flops that give this type of analysis such a bad name, as there is very rarely an alternate scenario posted in real time. All us non EW users have to go on is the absolute way in which practitioners speak about the wave counts at the time. Is it any wonder there are so many people skeptical about it's practical use?

To bring things back on topic and make it a little more relevant, in regards to the index count you've got now, perhaps you could post alternate counts, or price levels that would see you flip to a long trade(I'm gathering you are short based on your last post in the XAO analysis thread).

FWIW currently I'm expecting new highs on the S&P500 over the next 12 months(my main trading instrument), so I guess that considering you are calling the XAO in a wave 5 down, that pretty well places us largely on the opposite sides of the market for the next little while, barring some kind of localised financial crisis that doesn't impact the rest of the world.

The only thing I can see impacting my opinion at this stage is a rapid oil price spike, so provided we don't see $150 oil in the next 6 months then I'll generally be playing the long side of the market a lot more than the short side.


----------



## joea

the phantom said:


> In my opinion, EW is a con.
> 
> Don't need it, will never need it.
> 
> Same with fibonacci levels.
> 
> Btw, I do subscribe to T/A, but not this voodoo




Hi.
Your opinion is noted!

However the people who use it are looking possibly for "pattern position" to identify if the market or stock, is in a trend or correction.
If the trader is trading a position (long) and does not "buy and hold", the two benefical trades are Wave 3 and 5, in a 5 wave pattern.(GENERALLY)
There is one key guideline for (trend and correction), and just three patterns to identify trend and correction.
Fibonacci levels are then use to predict the exit area( OR TARGET).

Bob Miner and Carolyn Boroden supply this infomation. but it is best to buy both BOOKS as a package to get the most from it.
Miner uses DTOSC as his indicator over two time frames, and Boroden utilises Fibonnaci, while she shows CCI being used "In the ideal set up".
Cheers.


----------



## tech/a

> Now I know that any single trade is essentially a coin flip and will ultimately be proven right or wrong as time goes by and price develops. What is the trigger for a wave count changing so suddenly though?




The continuation of the Wave 4 higher meant that it hadnt termianted so was still in the process of making Wave 4 GET labels the wave its currently in when it is at a point where a reversal from it would see it confirmed---consequently as it rises wave 4 just gets higher.If It wasnt labelled until aftet its confirmation that would be graphically easier to see but would appear hindsite---while its forming it will "Move" until it stops---
statement of the obvious.



> IMO it's these kinds of flip flops that give this type of analysis such a bad name, as there is very rarely an alternate scenario posted in real time.




Yes true.
Radge does on all his counts in his analysis of various stocks and instruments on his Private section.

I would say that practitioners (Like myself) give E/W a worse name than the principal. When youve looked at as many charts as I have and have seen time and again Elliott counts and principals met---I just had to make the time and effort to understand how I could apply it to my analysis in a way that meant---I was involved in it---not seeing it after it finished.---Which is too late to use---again obvious.
*Frankly if I cant see an obvious count then I wont go looking to find one,*it means that the instrument in question will not be trending and as such not worth trading.



> All us non EW users have to go on is the absolute way in which practitioners speak about the wave counts at the time. Is it any wonder there are so many people skeptical about it's practical use?




Yes understood.
{If Im meant to go forward how can I be going backward "As expected"??}

Probability in analysis (Wave counts) increase with corellated Analytical evidence.
(A high volume thrust away from a low or high for example.)
In future I at least will attempt to increase the analytical quality of the Chart in question with at least an alternative. PEN got me in the early days of analysing it as ith made a higher wave 5---as an example if you want to read the thread. I copped a heap at the time---mostly laughter and jest.--Few weeks later and more jest as price plummeted from 16c to 6c!!---At least I knew it was coming and was well out of the trade!



> To bring things back on topic and make it a little more relevant, in regards to the index count you've got now, perhaps you could post alternate counts, or price levels that would see you flip to a long trade(I'm gathering you are short based on your last post in the XAO analysis thread).




Will do and could do the S&P
I think I have the charty in my downloads--EOD.


----------



## barney

tech/a said:


> PEN got me in the early days of analysing it as ith made a higher wave 5---as an example if you want to read the thread. I copped a heap at the time---mostly laughter and jest.--Few weeks later and more jest as price plummeted from 16c to 6c!!---*At least I knew it was coming and was well out of the trade*!




You knew an earth quake and tsunami was going to decimate Japan ... and you didn't warn anybody !!   ....... Shame on you tech


----------



## bbker

He did say it would drop to 9.5c (without the quake)

So the 6c is a side-effect of the unforeseen event 

But we'll never know what would have eventuated 



barney said:


> You knew an earth quake and tsunami was going to decimate Japan ... and you didn't warn anybody !!   ....... Shame on you tech


----------



## tech/a

barney said:


> You knew an earth quake and tsunami was going to decimate Japan ... and you didn't warn anybody !!   ....... Shame on you tech




No but I did know it was going to come off.

Further analysis to help (Hopefully --alternate counts)





PEN


----------



## tech/a

Should mention that the PROFIT TAKING INDEX PTI is 15 for PEN indicating that a LOWER wave 5 than wave 3 is highly un likely.
Double bottoms are common so 6c might well be your best low estimate!

Its in red at the bottom of wave 3 I have written an explanation on the XAO thread.
(If interested).


----------



## barney

tech/a said:


> No but I did know it was going to come off.




I agree tech  ( I was only being cheeky as you know )  .... 

After such a strong run up, and with so much open profit sitting on the table, the odds of a retrace were high.  

I also had around 9.5 cents pegged as a previous high volume area of support ..... Black Swans are no respecter of person however! 

For that reason I was curious as to whether EW counts would/should be reset in instances such as PEN, as the "ball game" is operating under a different set of fundamental rules ...... and for EW to be consistent, I assume the ground rules would need to be fairly constant to verify the analysis?

Any randomness added to a conceptual system will have a tendency to skew the results, and may not be a true reflection of broad based results ...... (just an observation ...no foundation in fact of course)


----------



## zzaaxxss3401

Really interesting thread - thanks tech/a (and others) for your input.

Regarding the XAO analysis... are you suggesting that if Wave 4 goes higher than Wave 1, "moving" wave count may actually renumber this as an ABC correction, and Wave 4 may actually be a Wave 1 (of a 5 wave impulse wave UP)?

I've recently borrowed a book on EW, but still learning to apply it to *current* charts.


----------



## Boggo

zzaaxxss3401 said:


> Regarding the XAO analysis... are you suggesting that if Wave 4 goes higher than Wave 1, "moving" wave count may actually renumber this as an ABC correction, and Wave 4 may actually be a Wave 1 (of a 5 wave impulse wave UP)?




The down leg ( W.3 ??) seems to have exceeded that theoretical parameters for an ABC correction.

(click to expand)


----------



## zzaaxxss3401

Boggo said:


> The down leg ( W.3 ??) seems to have exceeded that theoretical parameters for an ABC correction.
> 
> (click to expand)



Thanks Boggo - That was exactly what I was referring to... and I have clearly forgotten about the "rules" of the various wave lengths. Time to RTFM (Read The F#$%ing Manual) again. I'm really intrigued by all of this stuff... so hopefully one day soon it will all fall into place.


----------



## tech/a

So for me *MY* practical application of this analysis is.

I am looking for the Index and Stocks in it to reach 4700-4780 then correct again.
With this expectation I have 

(1) Tightened those in the portfolio (I have a - Long - portfolio of stocks) I expect to be most at risk.
(2) Will be looking for weakness at the upper limits of this expected range and look to hedge by way of Short Index trades.
(3) Those stocks displaying strong resilience in the portfolio will be watched if exited for low risk re entries.


----------



## professor_frink

tech/a said:


> Will do and could do the S&P
> I think I have the charty in my downloads--EOD.




If you feel like doing it, I'd be happy to follow any commentary run on the S&P500, it would be interesting to any difference in the counts between that one and the XAO/XJO.


----------



## toocool

So from my very basic EW knowlage (just from this thread) I found this one,

Any insight welcome has it completed a wave 5 down ?  and now on to a watch list ?


----------



## tech/a

Your count is incorrect. (Not close)
Wave 3 cannot be the shortest wave of 1,3,5.
Find youself the basic rules in Elliott Wave before
you attempt to apply it.


----------



## toocool

tech/a said:


> .
> Find youself the basic rules in Elliott Wave before
> you attempt to apply it.




Noted..


----------



## Boggo

An example of a breakout and EW working together.
I bought it on the breakout and now EW is having a say in where it may end or correct.

Its in the centre of the first W.3 target again today, last time it hesitated, lets see what it does this time.

Entry and current charts below
(click to expand)


----------



## skc

JBH weekly. 




This has got to be as textbook Elliott Wave chart as they come.

Perfect ABC wave 2 retracement during the GFC, wave 3 was ~1.6x wave 1. The current wave 4 retracement is bang right at 38%, couple with support from the previous high at ~$17 and a reversal weekly candle as a bonus.

Is this enough for the EW traders to enter a long position?


----------



## Boggo

skc said:


> JBH weekly.
> 
> Is this enough for the EW traders to enter a long position?




Giday skc.
Not for me yet, I dont like to see the 'typical wave C' box overlapping W.1 by that much, middle of that typical area is about $16.40.
$17.00 may hold but at an initial glance its going to be tight, needs a good positive upturn but then you may run into the capacity of W.5 assuming its a potential five wave event.
Where to enter ????

Just my 

(click to expand)


----------



## Boggo

Boggo said:


> The interesting bit is that MTPredictor auto routine won't plot either selection as a W.4 because (I suspect) neither retrace W.3 by 38.2, the ideal minimum retracement, *it still has it in a W.3 *




From post #21
I think MTPredictor may be right, it closed on $2.47 today.

Yesterday's chart.

(click to expand)


----------



## mazzatelli

tech
I'm interested in what your son thinks of Elliot Wave Theory and whether he subscribes to it, with his strong math/stats bg.

I don't recall if it was you, but I'm sure you mentioned using knowledge from David Aronson's book: Evidence Based Technical Analysis. David is not a strong advocate of EW, so would like to know your thoughts on his thoughts.

I'm not trying to disprove/convince/criticize etc., just like to see some of your thought process behind it.


----------



## tech/a

It wasnt I concerning David.

Kris has no opinion nor any knowledge of Elliott.

The only Elliott he knows is Gobblett--he (Kris) has a wicked sense of humor.

We are working on various aspects of trading but Elliott isnt one of them.
Its what I use in my discretionary trading and *limited to *considering where I am in the life of a chart---it isnt the basis of my decision but is a flag.

I will have a chat with him on the topic one day.

I do think it is logical in many respects which I will suggest for discussion over the weekend. Elliott must have also seen the "logic".--he was an Engineer.


----------



## mazzatelli

My apologies for misquoting you on Aronson.

Goblet is awesome!!!

I've seen some papers on Elliot interposed with fractal analysis, but have never seen practical application.

I see you are using it to trade a theme. 
Thanks for sharing.


----------



## tech/a

tech/a said:


> So for me *MY* practical application of this analysis is.
> 
> I am looking for the Index and Stocks in it to reach 4700-4780 then correct again.
> With this expectation I have
> 
> (1) Tightened those in the portfolio (I have a - Long - portfolio of stocks) I expect to be most at risk.
> (2) Will be looking for weakness at the upper limits of this expected range and look to hedge by way of Short Index trades.
> (3) Those stocks displaying strong resilience in the portfolio will be watched if exited for low risk re entries.




4790 all now set in place 
Have (On Friday) set the portfolio as stated above.
Fair day so far today.

Practical application.


----------



## skc

Boggo said:


> Giday skc.
> Not for me yet, I dont like to see the 'typical wave C' box overlapping W.1 by that much, middle of that typical area is about $16.40.
> $17.00 may hold but at an initial glance its going to be tight, needs a good positive upturn but then you may run into the capacity of W.5 assuming its a potential five wave event.
> Where to enter ????
> 
> Just my
> 
> (click to expand)




Fair call. Thanks for the response.


----------



## tech/a

Following on from this morning and the application of the analysis.
Today was a strong day for me with 3 trades out of the portfolio taking out their close trailing stops for an $800 loss.
Yet the portfolio value grew throughout the day (Unrealized profit).
Too early to call a roll over as expected but am set up for either scenario.





So what I'm hoping is people are realizing that the analysis gives you the opportunity to do far more than just take a trade.
The real money is made managing your portfolio.
Giving back as little as possible and keeping as much alive while its profitable.


----------



## professor_frink

I'd  be interested in getting an update on the XAO count tech, how does it change from here? 
Assuming today doesn't selloff by a couple of percent before the close, the earlier one would now be invalidated wouldn't it


----------



## tech/a

Yes it would.
Even if it fell a few % the count would be from the high.
I dont have GET at the office and will be out tonight.
Ill post it up and the expected strategy from here when I get a chance.


----------



## professor_frink

tech/a said:


> Yes it would.
> Even if it fell a few % the count would be from the high.
> I dont have GET at the office and will be out tonight.
> Ill post it up and the expected strategy from here when I get a chance.




cheers tech, appreciate it.


----------



## sinner

professor_frink said:


> I'd  be interested in getting an update on the XAO count tech, how does it change from here?
> Assuming today doesn't selloff by a couple of percent before the close, the earlier one would now be invalidated wouldn't it




The most obvious count alteration (I do it in my head rather than using software so maybe it isn't good enough for you) is like this:

Old count:



Invalidated during todays trading. So I go back one impulsive, to the last fully completed count, including the new information:




So we have five impulse up completed, A-B-C down completed, and that would make the current wave proposed as wave 1 of the next impulse up in progress or nearing completion. Once a valid swing high is in place, looking for a retracement which does not exceed the end of wave C/proposed wave 1 low. 

Then, aggressive traders looking to use PA triggers around the bottoms of this retracement (or proposed wave 2) to enter with stops just below the proposed wave 1 low. Conservative traders looking to trade longs on a break of the wave 1 swing high with stops at the proposed wave 1 low, using fib exts and confluence of prior fib retracements as target zones.

Like I said, my counting is rudimentary styles as I'm not trying to forecast, but it has always been an extremely useful tool in defining parameters to keep you in the trend. Many traders use EW likes this it seems and I am very happy with the results. In some cases (GBPUSD decline Jan-Jun 2010 anyone?) I had the whole move mapped out and posted on the net months in advance (I can chase my posts from forexfactory if you are curious) and it followed the whole thing perfectly. But that perfect count itself, was the direct result of an invalidated count. i.e. I said oops a wave 1 low has been exceeded, count is wrong, new parameters required!

P.S: The sign that made *me* personally think the "old count" would lead to a new impulse down, was that the retracement off highs exceeded the previous wave 4 low (as shown in second chart) rather than finding obvious support there.


----------



## skc

sinner said:


> Invalidated during todays trading. So I go back one impulsive, to the last fully completed count, including the new information:
> 
> View attachment 42139
> 
> 
> So we have five impulse up completed, A-B-C down completed, and that would make the current wave proposed as wave 1 of the next impulse up in progress or nearing completion. Once a valid swing high is in place, looking for a retracement which does not exceed the end of wave C/proposed wave 1 low.




Questions please...

How do you know that the current wave 1 is near completion? Is there a level where it will typically end?

What if we impulse down and take out the low of Wave C? How would you label the count then?

Thanks.


----------



## mazzatelli

sinner said:


> Like I said, my counting is rudimentary styles as I'm not trying to forecast, but it has always been an extremely useful tool in defining parameters to keep you in the trend.




Not to derail the thread, have you ever looked at variance ratio tests for the same usage?


----------



## sinner

skc said:


> Questions please...
> 
> How do you know that the current wave 1 is near completion? Is there a level where it will typically end?
> 
> What if we impulse down and take out the low of Wave C? How would you label the count then?
> 
> Thanks.




Good questions!

1. Use fib retracements and interaction with MAs to determine state "near completion"/typical ending levels but personally won't label it as complete until a valid swing high is in place, preferably with a key reversal or similar price action at the swing high.  I know AGET and the software Boggo uses both use "max/min" settings based on fib retracement/expansion numbers of various magnitude swings. 

But for me, once the swing high is in place I will start looking for price action and support between that swing high and wave 1 low to confirm. It won't always! Which leads to...

2. If we swing heavy down from here and break the low I would still view the 1-2-3-4-5 impulse up of that second chart as valid, and place us in a "complex or irregular correction". So the A-B-C down is still valid, but there might be legs -X-D-E-F to go or we might be going into some sort of broadening consolidation pattern, and because complex Elliott counts are beyond me I would use breakout of a standard deviation channel from the absolute swing high (end wave 5/proposed wave A high) to absolute swing low (proposed wave F low which obviously isn't on the chart yet) before taking any new trades. 

It happens.


----------



## skc

sinner said:


> ...It happens.




Thank you.


----------



## sinner

mazzatelli said:


> Not to derail the thread, have you ever looked at variance ratio tests for the same usage?




Far out man, we can't all be genius like you! 

Again just like my EW counts, I use something like this, but in a *very* rudimentary fashion, i.e. it's not even computed as variance, I just visually looking at the short vs long intervals. I don't want to say exactly what the lines below are as they are of my own invention and I like them a lot, but I am sure *you* could figure it out and they sprung to mind immediately as I saw your question  

The top is "long term" bottom is "short term" equivalents of what you might plug into the variance ratio equation, on BHP. For the purposes of not derailing the thread, I set the long term to n=34 and short term n=5, to match the Elliott Wave use of fib numbers


----------



## Boggo

sinner said:


> The most obvious count alteration (I do it in my head rather than using software so maybe it isn't good enough for you) is like this:




Got to catch a flight soon so just a quick response.

The potential ABC on the first chart on this post is still intact (ie. 4931), tomorrow may be a significant day.
https://www.aussiestockforums.com/forums/showthread.php?t=4888&p=621986&viewfull=1#post621986


----------



## coolo

The way I see it, today's price action completes a ZigZag correction from 17/03.

I expect to see XAO come off at least 500 points in the next month.

Just my 2 

coolo


----------



## professor_frink

Sinner, Boggo, thanks for the update on things


----------



## Sean K

coolo said:


> The way I see it, today's price action completes a ZigZag correction from 17/03.
> 
> I expect to see XAO come off at least 500 points in the next month.
> 
> Just my 2
> 
> coolo



So, using EW you are short at this point. Tell us when you close the trade.


----------



## sinner

kennas said:


> So, using EW you are short at this point. Tell us when you close the trade.




Personally I didn't feel like coolos post matched with the thread title or attempts by various members to try and elucidate but didn't want to offend or confront either.

Apparently short, with no parameters, stoploss levels, takeprofit levels (except "500 points in the next month"), etc. Unfortunately I don't even understand his count, but that wouldn't be the first time I couldn't grasp an EW count.


----------



## coolo

OOOPS!!!!.....sorry to intrude........just happened to re-discover this forum after registering a long time ago.

I don't normally follow XJO but thought that I'd do a quick wave count & the chart posted was my attempt to see where the OZ market was positioned. It was a quick count & even detailed counts ain't necessarily correct.

Elliott waves are fractals & you can never be sure that you have the count nailed. They are all variations of the same 3/5 wave pattern. A coastline is a fractal & if viewed from 100m, 1km, 10km or 100km or from the moon....it still looks like a coastline. You can never be sure that what you think may be the headland that will change the direction of the coastline is really in view at the elevation from which you are viewing.

However, there are some safeguards. A new trend....be it from the end of an impulse to the start of the 3-wave correction OR the end of the correction to the beginning of a new 5-wave impulse....will always start with an impulse (as wave 1 of an impulse in the new direction or as wave A of the correction) & will always be followed by another impulse after the wave 2 (or wave B) correction.

So.....if you can confirm that the change of direction STARTS with an impulse followed by a 3-wave correction, another impulse will follow........& trade that impulse.



@Kennas.........No I'n not short yet as market action today appears to be waves 1-4 of a leading diagonal.....wave 4 has already overlapped wave 1.... which could morph into a zigzag & continue the up-trend. I only trade if I see a difinitive 5-wave impulses that are followed by 3-wave corrections & look to take my money after the next impulse has reached 100% of the length of wave 1. The stop is placed 1 point beyond the start of wave 1.

@sinner......the first impulse down from Feb to mid March was 500 points . That's the target.

Again......sorry for being off topic...............happy trading!!

coolo


----------



## Boggo

Follow up to my post on the 26th, I am going to stay with how I saw it then based on a potential ABC until it *closes* above 4931.
https://www.aussiestockforums.com/forums/showthread.php?t=4888&p=621986&viewfull=1#post621986



Boggo said:


> Next sequence should it close above 4877 would be to call all of the last down leg a wave A and the current up leg to be a wave B.
> For that to be valid this uptrend cannot close above 4931 which is the 0.786 retracement of wave A and the theoretical limit for a wave B.




(click to expand)


----------



## Sean K

coolo said:


> Elliott waves are fractals & you can never be sure that you have the count nailed. They are all variations of the same 3/5 wave pattern. A coastline is a fractal & if viewed from 100m, 1km, 10km or 100km or from the moon....it still looks like a coastline. You can never be sure that what you think may be the headland that will change the direction of the coastline is really in view at the elevation from which you are viewing.



Any TA is within a time period and chart scales. 

A daily chart over a one month period will look different to a yearly chart over the same time. 

You may get the point. 

This is a 'practical use of EW analysis', not what might have been.

Post a buy/sell based on EW.

Followed by a sell/buy.

Then we can see how it's applied.


----------



## tech/a

Kennas

You dont have to trade pure E/W signals to apply it practically.
A few here Boggo and myself use Elliott in a practical way buy adding it to our analysis tool box.

As Ive said before having an idea where you are in a chart ---as in its life of price movement--gives you a sound basis from which to base your trading.
Ive pointed out above how I do it.

Specifically the XJO is in a cautionary area of topping and until proven otherwise trading the XJO should be treated as such---with caution to the long side. 

For those and I believe your in the group of those---who expect a point of analysis to be finite and fixed from point of analysis forward---you will be constantly disappointed---not only with Elliott but with *EVERY* form of analysis including fundamental.The goal posts move constantly and we can only trade in anticipation of our analysis.It will be right or wrong.
We must know how to trade when its right and when its wrong.
*TRUE OF ALL ANALYSIS.*


----------



## Boggo

tech/a said:


> Kennas
> 
> As Ive said before having an idea where you are in a chart ---as in its life of price movement--gives you a sound basis from which to base your trading.
> Ive pointed out above how I do it.
> 
> The goal posts move constantly and we can only trade in anticipation of our analysis.It will be right or wrong.
> We must know how to trade when its right and when its wrong.




kennas, below is an example of what tech/a is saying.
I entered this (ALK) on a breakout but 'could see' the potential pattern that might play out and the potential targets points along the way if it followed the rules.
https://www.aussiestockforums.com/forums/showthread.php?t=4382&p=612696&viewfull=1#post612696

I know that this stock is now at another area where it may reverse and when it does I can plot the areas that it is likely to retrace to and if it follows a predictable pattern I can re-enter and extract some more from it.

In the current market it seems harder than normal to apply EW on its own but it is still a very valuable tool.
Have a look at the posts on here for an example of buying blindly and then not knowing what next when it comes to targets or exits.
https://www.aussiestockforums.com/forums/showthread.php?t=22341

Current state of ALK. (click to expand)


----------



## Boggo

One example of my process when looking for EW candidates.

I get MTPredictor to do four scans, and intermediate and major of both the ASX300 and of the ASX Metals & Mining sector.

I the eyeball the results looking for good looking setups, the software just follows a programmed routine so it is up to me to know what may be useful.

I have attached last night's intermediate scan of the ASX300 below, note that there are no buys, market barometer perhaps.
I haven't looked at any of these results, not sure if there is anything of value there (something for kennas to do  )

I have also attached two charts of NCM, one from MTPredictor where it picked up a perfect ABC (TS3 blue = Long) and also a chart from Metastock.

Note the areas I have highlighted and in particular note the potential buy signals near the top on the Metastock chart.
Looking at the MTPredictor chart it becomes obvious why you would ignore those signals, this is what tech/a is explaining about knowing where you are in the life of a stock.

Also on the MTPredictor chart of NCM you can see what the different scan results may look like on a chart (Red = Short and Blue = Long).

(click to expand)


----------



## tech/a

Thanks Boggo

Exactly.

Nicely explained.


----------



## tech/a

And so here we are at the turn (I do think that analysis points to this as a significant point of reference.)

I will be shorting indexes Monday
Ive already culled weak stock.
New long positions will be eyed very carefully.

If all pans out looking for good corrective patterns will be my aim in the nearer future.

Click to expand.


----------



## Sean K

tech/a said:


> And so here we are at the turn (I do think that analysis points to this as a significant point of reference.)
> 
> I will be shorting indexes Monday
> Ive already culled weak stock.
> New long positions will be eyed very carefully.
> 
> If all pans out looking for good corrective patterns will be my aim in the nearer future.
> 
> Click to expand.
> 
> View attachment 42336



Tech, we went up yesterday, so does that indicate a potential breakout, or need to give it a confirmatory leg up? 

If that wasn't the top of 3 then with EW do you just continue to wait for the confirmed top before shorting again?

Or, does moving through this zone completely change the count to something more complex?


----------



## tech/a

kennas said:


> Tech, we went up yesterday, so does that indicate a potential breakout, or need to give it a confirmatory leg up?
> 
> If that wasn't the top of 3 then with EW do you just continue to wait for the confirmed top before shorting again?
> 
> Or, does moving through this zone completely change the count to something more complex?




Kennas
Im looking for weakness.
I havent seen it yet in the ORDS nor in my portfolio.
I have seen some pulling back while my portfolio increased yesterday 1 sold on a trailing stop and my high profit of the day was well above the closing profit.

I saw an opportunity short in the DAX and am still short there.

The next level in the XJO is 5030 resistance.
If that is broken then the count will alter once more.

Im looking very carefully at any new prospects as breakouts are now displaying that they are forming last legs or Wave 5 s in the charts I'm seeing.

That doesn't auger well for trades on the long side.


----------



## tech/a

tech/a said:


> Kennas
> Im looking for weakness.
> I havent seen it yet in the ORDS nor in my portfolio.
> I have seen some pulling back while my portfolio increased yesterday 1 sold on a trailing stop and my high profit of the day was well above the closing profit.
> 
> I saw an opportunity short in the DAX and am still short there.
> 
> The next level in the XJO is 5030 resistance.
> If that is broken then the count will alter once more.
> 
> Im looking very carefully at any new prospects as breakouts are now displaying that they are forming last legs or Wave 5 s in the charts I'm seeing.
> 
> That doesn't auger well for trades on the long side.




Fortunately the 1 dax contract has preserved my portfolio which got belted today!


----------



## Sean K

tech/a said:


> Fortunately the 1 dax contract has preserved my portfolio which got belted today!



The weakness yesterday must certainly now add to the 3 top. Quite a turnaround from the day previous. UK down quite a bit atm. Interesting to watch it unfold.


----------



## aarbee

> Im looking very carefully at any new prospects as breakouts are now displaying that they are forming last legs or Wave 5 s in the charts I'm seeing.
> 
> That doesn't auger well for trades on the long side.




Hi Tech,

Can you elaborate on your mental process/tech analysis involved in determining that a breakout is on its last leg. I am new to this sort of analysis and find it very intriguing. 

Cheers


----------



## tech/a

aarbee said:


> Hi Tech,
> 
> Can you elaborate on your mental process/tech analysis involved in determining that a breakout is on its last leg. I am new to this sort of analysis and find it very intriguing.
> 
> Cheers




Ill put it in the breakout thread.
Dont have time now but if I forget remind me.
Boggo knows what I'm on about as well and he may put up a chart or 2 he did an example the other day---cant remember which thread.

Just closed the DAX trade.
Basically hedged todays catastrophe


----------



## Boggo

tech/a said:


> Boggo knows what I'm on about as well and he may put up a chart or 2 he did an example the other day---cant remember which thread.




This may be the one you are referring to tech/a, if not I can pop an example up.
https://www.aussiestockforums.com/forums/showthread.php?t=22194&p=624432&viewfull=1#post624432


----------



## tech/a

Thanks *BOGGO *explained perfectly.




RazzaDazzla said:


> Where to from here tech? Back down to recent lows (some type of flat pattern) or a small breather and higher highs?




I liken bullish moves to a train--if you want to pull it up its going to take a while.
Bearish moves are like dropping a ball on concrete---the higher and quicker it falls the bigger the bounce.

This reversal deep and quick has me think its sending a message of weakness.
There will be a bounce and its strength will tell a lot. I expect that if new highs are made it will be like extracting blood from a stone!

So my plan is to look for short opportunities on indexes and wait for signs of corrective patterns in the now much lighter portfolio.
In this fickle corrective pattern trends will be short.So my time frame also shortens more than usual as does my risk down to .25 and .5% (Portfolio long plays)

*WEEKLY XJO CHART* click to expand

*
View attachment 42384
*


----------



## markhocky

Hi all,

Thought the readers of this thread might find the following of some use.

CSS analytics is running a few posts on how to model / code more subjective studies like Elliot Wave to help with systematically testing.

http://cssanalytics.wordpress.com/2011/04/10/css-wave-theory-building-blocks-part-1/

I don't pretend to know anything about how EW works, or how to apply it, so can't vouch for how good the method presetented by CSS is. But nevertheless thought I would share so those that do know can assess.

Cheers,
Mark.


----------



## Boggo

markhocky said:


> Hi all,
> 
> Thought the readers of this thread might find the following of some use.
> 
> Cheers,
> Mark.




Interesting Mark, I have seen a few attempts at trying to simplify or alter the theory of EW to fit with the "current" market but the end result usually ends up back with the original theory and the associated basic rules.
The basic application also always comes back to the same, ie, it works 50% of the time on 50% of the market and that is where you then apply Robert Miner's 'kiss' principle.

It will be interesting to see some examples of what he is doing though when he produces the next parts.

One of the links on that page you link to has some worthwhile comments, it refers to Forex but applies to all markets.
Both the XAO and the XJO are examples at moment where you have to look at the weekly for a better picture of where the daily is likely to be heading.

This is a comment from that site...
_"Like any other technical analysis, EW by itself can never be used in isolation and hence it has to be handled with a lot of caution. The 2 things i look for in EW are a) on a higher time frame is it an impulsive wave or a corrective and how does the wave look on the lower time frame b) Corresponding momentum"_

http://fourweekforexchallenge.wordpress.com/2010/02/13/wave-theory-applied-to-forex/

Cheers


----------



## Chris45

Boggo, In your post #16, https://www.aussiestockforums.com/forums/showthread.php?t=22194&p=620943&viewfull=1#post620943  your chart of ELM showed a "max target" of just under $3.00, which looks like a fib. extension from somewhere plotted by your software.

I see that the high on $4-Apr was $3.00! Who says this EW/fib stuff doesn't work???


----------



## Wysiwyg

Chris45 said:


> I see that the high on $4-Apr was $3.00! Who says this EW/fib stuff doesn't work???



Everything "works" but not all the time. Anyone that has been in the game for awhile knows this.


----------



## Boggo

Chris45 said:


> I see that the high on $4-Apr was $3.00! Who says this EW/fib stuff doesn't work???






Wysiwyg said:


> Everything "works" but not all the time. Anyone that has been in the game for awhile knows this.




Works 50% of the time on 50% of the market is a starting point.

Its all about knowing when it may be working and making full use of it and more importantly recognising when it stops working or may not have actually been working in the first place and having an exit strategy or revised plan.

There are numerous ways of catching breakouts (such as ELM) but the real art seems to be knowing where the breakout may continue to and if it is worth pursuing.
This is still a major work in progress for me and I still have a way to go but I can see the potential in it.
Its what tech/a often refers to as knowing where the stock is in its life or cycle at the breakout or reversal.

Assuming that we have had a W.3 on ELM then the theoretical completion of W.4 may be around the areas shown below.
(click to expand)


----------



## Sean K

tech/a said:


> This reversal deep and quick has me think its sending a message of weakness.
> There will be a bounce and its strength will tell a lot. I expect that if new highs are made it will be like extracting blood from a stone!
> 
> So my plan is to look for short opportunities on indexes and wait for signs of corrective patterns in the now much lighter portfolio.
> In this fickle corrective pattern trends will be short.So my time frame also shortens more than usual as does my risk down to .25 and .5% (Portfolio long plays)
> 
> *WEEKLY XJO CHART* click to expand
> 
> *
> View attachment 42384
> *



Tech, that chart still looks like a  sideways move since late 09 with no sure sign of either way except for the _potential_ W4 top. 

So, that is the basis of the short bias, correct? 

I'm still trying to make something more conclusive and tradable about this position in the market. 

(Yes, I know TA is not concrete, just probabilities - disappointed you thought I had that position after 5 years..)

However, this is 'practical use of EW' so, I think it's important that it looks like it's tradable. 

At the moment, you application of EW has made you sell positions in preparation for the W5 down by what I read. That will change with a move up through the W4 and significant resistant zone. Si?


----------



## tech/a

> I'm still trying to make something more conclusive and tradable about this position in the market.
> 
> (Yes, I know TA is not concrete, just probabilities - disappointed you thought I had that position after 5 years..)
> 
> However, this is 'practical use of EW' so, I think it's important that it looks like it's tradable.




Elliot for me in all trades I take gives me an indication of where the stock or index is in the context of its current life. 
Is it topping
Is it starting a new Trend
Is it in the middle of a trend
Is it in a corrective phase.

So practical use of Elliott goes (in my view and use) way beyond trading Elliott as a singular methodology. It can and sometimes I do use it as a single stand alone trading tool.
But currently the Index which we are looking at is in a corrective pattern and topping in that pattern.
Ive only sold weak stocks and they were exited by tightening trailing stops.
New trades are always being taken but I use tighter stops and smaller position sizes---due to the fact that this market is weak--LONG.
While looking for weakness last week I managed to trade a short DAX trade overnight which kept my capital neutral while the constituents got smashed that day.




> At the moment, you application of EW has made you sell positions in preparation for the W5 down by what I read. That will change with a move up through the W4 and significant resistant zone. Si?




Its made me cull weak positions---they have continued to be weak holding them would have been MORE costly. Stronger moves have appeared and I have bought new positions (See above) I have 3 new positions logged for conditional buys tomorrow.

Running my portfolio is like a river continually flowing.
Those who have more a set and watch trading style just will never get their head around how I trade.---in a discretionary manner.

No point in being discretionary if you set your trading to a set plan or system and watch it pan out---might as well have a tested system.

My constant monitoring is designed to keep the numbers skewed in my direction.

Hope that helps but I can see you struggling with analysis which isn't definitive---you expect it to be--I dont--in fact I expect it to be anything but definitive and trade in a discretionary manner to accommodate that.


----------



## Sean K

tech/a said:


> Hope that helps but I can see you struggling with analysis which isn't definitive---you expect it to be--I dont--in fact I expect it to be anything but definitive and trade in a discretionary manner to accommodate that.



 Not all Tech. 

I have not see one practical EW generated trade yet. 

Unless I missed it while sipping English brew over the past couple of weeks.

Point us to a trade.


----------



## tech/a

Perhaps I should have titled the thread 
*MY* Practical use of Elliott Wave analysis.
OR better still
Practical use of Elliott Wave analysis which will satisfy Kenna's
In the former I have and will continue to explain if others are deriving benefit.
In the latter I cannot satisfy you Kenna's.
Elliott by your definition has no practical use.
Never has and never will.

Finally the title never was
Trading *exclusively* with Elliott wave analysis.


----------



## IFocus

kennas said:


> Not all Tech.
> 
> I have not see one practical EW generated trade yet.
> 
> .




kennas you are driving me nuts. 

The tile of Techs thread is Practical use of Elliott wave which I think has been excellent for anyone interested. 

Its not practical trading of EW even tho Boggo on the forum has shown some excellent examples. 

If you can get a look at market conditions and if you can get a look at what stage the market is at then you can get a look  your probabilities when to take positions using a method that suits that time and place.

If you can do this *50% of the time* it can skew the numbers hugely in your favor.

BTW I have seen the market make fools of all EW gurus but then that's what the market is designed to do.


----------



## Chris45

Boggo said:


> Assuming that we have had a W.3 on ELM then the theoretical completion of W.4 may be around the areas shown below.




Boggo, I calculated ELM's W2 was an exact 50% retracement of W1, and W3 was approx. a 250% extension of W1 (close but not quite a Fib ratio ).

W2 looks complex and it now appears to be in a simple W4 A-B-C with W-B retracing 36% (~Fib38%).

A 100% extension of W-A gives a target of $2.08.

Your software gives two pairs of retracement levels for W4, the first pair for a retracement of W3 and the second pair for a retracement of W0-3.

Which pair, from your experience, has the higher probability of working in this situation?

Of the Fib levels printed, the $2.14 (~$2.11 Feb Hi) and $1.64 (~$1.65 Mar Lo) would seem to be logical support levels.

My very unsophisticated KISS trading approach, if it gets down to $2.14, would be to buy a breakout above a downtrend line from the $3.00 top so I'm interested to hear your thoughts how you would trade it.

Cheers.


----------



## tech/a

Kenna's

This is the same XJO chart in Daily.
You can see that it is panning out as expected.
So everything that is in place has been as the analysis indicated.


----------



## tech/a

ELM by Advanced GET




Note how this count has now altered as wave 5 in the original chart extended.
Altering the internal count of the wave.



	

		
			
		

		
	
.


----------



## Chris45

tech/a said:


> ELM by Advanced GET



Thanks Tech.


----------



## Boggo

Chris45 said:


> Your software gives two pairs of retracement levels for W4, the first pair for a retracement of W3 and the second pair for a retracement of W0-3.
> 
> Which pair, from your experience, has the higher probability of working in this situation?
> 
> Of the Fib levels printed, the $2.14 (~$2.11 Feb Hi) and $1.64 (~$1.65 Mar Lo) would seem to be logical support levels.
> 
> My very unsophisticated KISS trading approach, if it gets down to $2.14, would be to buy a breakout above a downtrend line from the $3.00 top so I'm interested to hear your thoughts how you would trade it.
> 
> Cheers.




Aha, you seem to be on to it Chris, obviously you can see how this theory can be used to create a picture.
By making use of retracements from two points tends to create a better target area and in the ELM case you are correct, the retracements seem to be referred to as W.4, W.1-3 and W.4, W.3.

As a rough "eyeball" point for retracement I look for points that converge or almost converge, the points that Robert Miner refers to as "Target Zones".

In the case of ELM the minimum expectation is around the 38% of W.3 but the target zone is between the two closest lines which would give an initial "eyeball" target of between $1.96 and $1.87 but the channel may be an influence at the 38% level as indicated on tech/a's chart above.
A complex correction may not stay in the channel though.

Trading it, wave 2's are always easier to trade as they tend to form a more symmetrical ABC and the W.3 is the money run.
 I look for similiar in the W.4 and either re-enter when it shows signs of turning at an expected level or wait for a confirmation break of the B if it seems to be a simple ABC rather than a complex pattern.
Waiting for a break of the previous W.3 high generally looks good but usually has a limited travel (expectation).


----------



## Sean K

tech/a said:


> Perhaps I should have titled the thread
> *MY* Practical use of Elliott Wave analysis.
> OR better still
> Practical use of Elliott Wave analysis which will satisfy Kenna's
> In the former I have and will continue to explain if others are deriving benefit.
> In the latter I cannot satisfy you Kenna's.
> Elliott by your definition has no practical use.
> Never has and never will.
> 
> Finally the title never was
> Trading *exclusively* with Elliott wave analysis.



OK, I can see where you're coming from.

EW is like support and resistance.

Like heads and shoulders.

Like double tops.

Like Gann.

Really can't be used in isolation at all. 

Just another 'tool' in the box.


Now, lets get back to it's 'practical use', except from trying to divert the conversation and make it personal.  



> Elliott by your definition has no practical use.
> Never has and never will.




I haven't provided a definition at all, but just wait to see a trade generated by EW.

You have stated that you sold many positions recently due to the W4 potential top. That to me is 'practical'. Very good! From what I've read here, you are still short or neutral because of that bias generated by Elliot.  

I am very happy with that as a practical use of EW even though there are no specifics.



IFocus said:


> kennas you are driving me nuts.
> 
> ...
> 
> BTW I have seen the market make fools of all EW gurus but then that's what the market is designed to do.



Happy to assist IF.

I really have no motivation here other that to make EW gurus look like gurus.

I'm now just been attacked for asking some pretty simple questions. We've all been around this buoy before and it just ends in EW practitioners taking personal pot shots and/or spitting the dummy. 

Back to some practical use of EW perhaps? Like how does it make you money?


----------



## tech/a

> I haven't provided a definition at all, but just wait to see a trade generated by EW.




Many trades last week were generated by the position E/W indicated the market to be.
5 Trades were taken out due to my tightening of trailing stops and around 4 trades generated short on indexes.
3 of those failed losing 35 ticks and 1 succeeded gaining 102 ticks.



> You have stated that you sold many positions recently due to the W4 potential top. That to me is 'practical'. Very good! From what I've read here, you are still short or neutral because of that bias generated by Elliot.




Some positions.
No current short positions have 3 new buy stop orders in and around 8 open long trades with trailing stops in place.


----------



## Chris45

Boggo said:


> In the case of ELM the minimum expectation is around the 38% of W.3 but the target zone is between the two closest lines which would give an initial "eyeball" target of between $1.96 and $1.87 but the channel may be an influence at the 38% level as indicated on tech/a's chart above.
> A complex correction may not stay in the channel though.
> 
> Trading it, wave 2's are always easier to trade as they tend to form a more symmetrical ABC and the W.3 is the money run.
> I look for similiar in the W.4 and either re-enter when it shows signs of turning at an expected level or wait for a confirmation break of the B if it seems to be a simple ABC rather than a complex pattern.
> Waiting for a break of the previous W.3 high generally looks good but usually has a limited travel (expectation).




Thanks Boggo. ELM seems to be EWaving nicely and could be an interesting test of GET's trading rules. 

Back in Dec-10, W1 & W2 were labeled W3 & W4 and W-C = W-A. Apart from the PTI being <35, the rules would have given a good entry.




It will be interesting to see how the rules perform this time.


----------



## tech/a

Short all indexes
SPI DAX and FTSE


----------



## tech/a

The silence is deafening!!


----------



## explod

tech/a said:


> The silence is deafening!!




Yep, the charts will do what they want to do and one can only follow.  A bit like if you are crashing through the jungle if your head was still intact you would soon learn that it is easier to follow behind the elephant

I tried a crystal ball rythmn idea at roulette once, thought I had the holy grail but;

*it did not work*.


----------



## Boggo

explod said:


> A bit like if you are crashing through the jungle if your head was still intact you would soon learn that it is easier to follow behind the *elephant*




Agree, especially in this case of the examples above, follow behind the  *E*leph*W*ant as you have a good idea where he might take you


----------



## Chris45

Boggo and Tech, GET has now moved ELM's W4 levels down to $1.96 & $1.64. The Osc (AKA MACD) is nearly back to zero, the PTI >35, and price > blue channel (and Stoch <20) so it's ticking all of the boxes, but the recent top of $3, after such a steep rise, is getting pretty high so do you guys think it is a buy at these levels or has the opportunity passed? I'm still low on the learning curve and maybe this was not the best one to use as an example and from what I understand of Weinstein's system it would not be a candidate. Cheers.


----------



## professor_frink

tech/a said:


> Short all indexes
> SPI DAX and FTSE






tech/a said:


> The silence is deafening!!




So you are short the SPI from 4840-45(roughly). What about the others?

Where's the stop for this type of trade?

How does it get managed?


----------



## wayneL

tech/a said:


> The silence is deafening!!




We're all busy buying with ears pinned back!


----------



## tech/a

professor_frink said:


> So you are short the SPI from 4840-45(roughly). What about the others?
> 
> Where's the stop for this type of trade?
> 
> How does it get managed?




I set a profit stop before I go to bed

FTSE was 5840
DAX was 7060
SPI  was 4800

All been and gone.

If they aren't hit overnight I assess in the morning.
I also set a stop loss.
That gets hit more often than not.
If the market isn't clearly in a trend then I will close before I go to bed.
I use VSA for entry.
*ALWAYS* trade with the trend do not look to pick a change in trend.

One buy in the portfolio today and one sold on trailing stop.
Current portfolio around 1/3rd normal holding (Capital invested).


----------



## Sean K

tech/a said:


> *ALWAYS* trade with the trend do not look to pick a change in trend.



Tech, is it EW setting the trend to trade at the moment? I think you indicated that it was a few days ago. ie, bias down. Is that still the case, or are you neutral according to any other signals? Has the larger EW count changed?


----------



## tech/a

kennas said:


> Tech, is it EW setting the trend to trade at the moment? I think you indicated that it was a few days ago. ie, bias down. Is that still the case, or are you neutral according to any other signals? Has the larger EW count changed?




I'm talking about short term index trading.
Sorry I take it that people reading this actually understand how I'm trading.
Elliot gave me the initial weakness. So I was looking for it.
When it was displayed in the indexes I took the trade just as I take trades most nights if the trend is clear.
On the XAO thread I mentioned that Bull markets are like trains to pull up and bear markets are like stones falling on concrete. Its the same with extreme moves of 1 day or so down---they bounce.
It was clear that the trend would be up tonight with a strong Asian day and both FTSE and DAX showed very low risk trades.
I open the DAX as soon as the SPI closes.
Im only trading the DAX---didnt trade the SPI long today.--It suprised me to be honest---the depth of the bounce--it really set up tonight.
.
Currently trading DAX only and set stops ready for bed.




The move today was so strong that I would be surprised if we dont see this as the start of the wave 5 move---this will be more complex than a simple "V" move up to the
5000-5050 mark---I think it is likely struggle up there in mid late may so strong moves I dont expect from here on.
Index trading will be more difficult as trend looks laborious but portfolio trades should pick up some losses and provide some opportunity for buyers like Wayne. 





Hmm great profit stop on the DAX just taken out
Radges NPST indicator works a treat!


----------



## professor_frink

tech/a said:


> I set a profit stop before I go to bed
> 
> FTSE was 5840
> DAX was 7060
> SPI  was 4800
> 
> All been and gone.
> 
> If they aren't hit overnight I assess in the morning.
> I also set a stop loss.
> That gets hit more often than not.
> If the market isn't clearly in a trend then I will close before I go to bed.
> I use VSA for entry.
> *ALWAYS* trade with the trend do not look to pick a change in trend.
> 
> One buy in the portfolio today and one sold on trailing stop.
> Current portfolio around 1/3rd normal holding (Capital invested).




ok then, so when you made this comment:



tech/a said:


> The silence is deafening!!




you were actually flat and not short. Seems like a slightly odd comment then

I'll leave you wavers to it then. Looking forward to seeing the counts updated as they evolve.


----------



## tech/a

tech/a said:


> The silence is deafening!!




Meaning comments on the practical use of Elliott.

I personally have found it and continue to find it invaluable.
However it appears that my demonstration of MY application 
of the analysis is less than helpful to all---hence deafening silence.

Expectation is that Elliott itself would be traded as stand alone.
When in fact its use by myself is trading the analysis of Elliott relative to my portfolio.
Which flows through to short term index positions.

Knowing where we are in the scheme of things makes trading much easier---in my opinion.
Anyway
Think Ive served the purpose well enough here to now leave this thread.
Hope its been helpful--perhaps not?.


----------



## wayneL

tech/a said:


> I personally have found it and continue to find it invaluable.




I personally have found it and continue to find it nonvaluable.

Horses for courses and all that, but no better or worse than nuanced (IOW non standard) use of any indicator, but a whole lot more complicated and opaque... brilliant for hindsight trading.


----------



## Chris45

tech/a said:


> The silence is deafening!!






Chris45 said:


> Boggo and Tech, GET has now moved ELM's W4 levels down to $1.96 & $1.64. The Osc (AKA MACD) is nearly back to zero, the PTI >35, and price > blue channel (and Stoch <20) so it's ticking all of the boxes, but the recent top of $3, after such a steep rise, is getting pretty high so do you guys think it is a buy at these levels or has the opportunity passed? I'm still low on the learning curve and maybe this was not the best one to use as an example and from what I understand of Weinstein's system it would not be a candidate. Cheers.




Bump.

Too simplistic or not interested? I thought this would be an interesting example to follow, but maybe not.


----------



## tech/a

Fair enough.
I msee Fundamental analysis as a gross waste of time---subjective and of no use to me.
So can understand your and others views.

Many cant understand why a system could be a good idea.
Or how VSA can be applied.
How to set up an options trade and the associated risks or risk mitigation.

Have a great break.

Chris
Happy to follow it.
Just looks as if its still in wave 4 so no comment.

Will have a look tonight.


----------



## Sean K

tech/a said:


> Think Ive served the purpose well enough here to now leave this thread.



No you haven't.

Tech, I was genuinely looking to see how EW is applied 'practically' to see how it generates trades. You have more than cleared this up to mean it's another tool to make trade decisions.

I don't think I've seen a live trade based on any EW input. 

To really see how this is 'practical' at all, it needs to be seen to be applied in real time. No retrospective stuff with charts that somehow have conformed to it in some way.

This is a great opportunity for EW to stand up and say 'IT WORKS!' 

Or, it just has no value at all...


----------



## Boggo

Chris45 said:


> Bump.
> 
> Too simplistic or not interested? I thought this would be an interesting example to follow, but maybe not.




Sorry Chris, been meaning to get back to you, no hurry, its doing what we expected, we picked the end of W.3, lets wait for the next clue as to how W.4 will play and plan accordingly.
Will have another look over the weekend though.

Does AGET have RRL in a W.5 with a min target around $2.85 ??



tech/a said:


> Fair enough.
> I see Fundamental analysis as a gross waste of time---subjective and of no use to me.
> So can understand your and others views.
> 
> Many cant understand why a system could be a good idea.




Fundamental analysis as I see quoted on here regularly is usually out of step with what is actually happening with a stock.
The people 'in the know' would love it if everyone adopted a fundamental approach as all they have to do is produce a bit of literary euphoria and they have an instant buying audience.

Compare the last year on charts of TLS and LEI with those fundamentally sound stocks such as MND and SUL, how often do you hear much (if anything) about the latter two.

I do understand how it seems to be the way to go, I did it for nearly four years that way.
In reality I was being told what to buy by the directors of the company or by an "expert" commentary by an advisor or broker who had a either a vested interest in seeing the stock being driven up or were looking for someone to sell to as they knew what was around the corner.
My only contribution was that I was pressing the buy button, everything else was dependant on what others told me.

Have a look at this video by LEI in October 2010 and then look at the share price at the same time and since then... http://www.youtube.com/watch?v=YabuZE462DY

EW is a bit more complex than just looking at a couple of moving averages as you are aware tech/a and consequently requires a bit more time, learning and dedication.
You can learn how to drive car a couple of days but a couple of years to learn how to fly a plane.
Passengers are often critical and have a commentary ("why are we going this way, the airport is over there ?") on how a flight should have been flown and always know if the landing was a bit fast or slow though


----------



## tech/a

kennas said:


> No you haven't.
> 
> Tech, I was genuinely looking to see how EW is applied 'practically' to see how it generates trades. You have more than cleared this up to mean it's another tool to make trade decisions.
> 
> I don't think I've seen a live trade based on any EW input.
> 
> To really see how this is 'practical' at all, it needs to be seen to be applied in real time. No retrospective stuff with charts that somehow have conformed to it in some way.
> 
> This is a great opportunity for EW to stand up and say 'IT WORKS!'
> 
> Or, it just has no value at all...




Kennas.
Frankly I dont care wether you find or have found value in my posts.
You cant see past the need to use Elliott in your view in its purest form. I have always stated that the thread would be practical application of E/W---Mine as thats all I know.

It is used by me as a guide to where an instrument is in its life.
That in turn *influences the way I trade *both portfolio's and Indexes.
As can be evidenced in my posts. Clearly the charts show pay testiment to the analysis both at the turning point of wave 3 and now at wave 4.

To those of you who see E/W as of no value great go on and use whatever it is that you use. Your right it has absolutely no value---to you. These posts are there for those---if any--- who wish to investigate further.


----------



## Boggo

tech/a said:


> To those of you who see E/W as of no value great go on and use whatever it is that you use. Your right it has absolutely no value---to you. These posts are there for those---if any--- who wish to investigate further.




:iagree:


----------



## Chris45

Boggo said:


> Does AGET have RRL in a W.5 with a min target around $2.85 ??




Boggo, targets seem to differ depending on the start point (which is logical). I set mine to start from 6Oct08 (is that where your count starts?) and it shows RRL is now in W5 with min target of $3.08 & max of $3.86. Can post a chart if you want.


----------



## Sean K

tech/a said:


> Kennas.
> Frankly I dont care wether you find or have found value in my posts.
> You cant see past the need to use Elliott in your view in its purest form. I have always stated that the thread would be practical application of E/W---Mine as thats all I know.
> 
> It is used by me as a guide to where an instrument is in its life.
> That in turn *influences the way I trade *both portfolio's and Indexes.
> As can be evidenced in my posts. Clearly the charts show pay testiment to the analysis both at the turning point of wave 3 and now at wave 4.
> 
> To those of you who see E/W as of no value great go on and use whatever it is that you use. Your right it has absolutely no value---to you. These posts are there for those---if any--- who wish to investigate further.



Tech, We're obviously not going to agree to disagree here, so I'll agree to that! 

Apart from the 15 or so grammatical errors in your last post, you have added significant insight to the great unwashed. Both in how to read a chart and the value of expensive software.



> Clearly the charts show pay testiment to the analysis both at the turning point of wave 3 and now at wave 4.



Your EW is now calling a W4 top and we're in the midst of down leg to W5. So, in the Tech mantra you use this as a means to be positioned with negative bias. Sell, or hedge.

Can't you incorporate your EW musings with some live trades so we can see it work. 

Not live, as in 'real' trades, just some live hypotheticals will do. 

If it's not consistent, repeatable and testable it is NOT a science, but mere quackery.


----------



## tech/a

Kennas you really have to take some time to actually *ATTEMPT* to understand posts.
I have posted BOTH daily and weekly charts
The daily is displaying a perfect wave 3 correction to Wave 4 now moving towards wave 5
The weekly is showing a wave 4
Both counts are still valid.

Clearly you have absolutely no idea----thats absolutely no idea.
Note the two charts See the "W" in the top area and the "D" in the other.

Mate Ill help anyone who is* GENUINELY* interested but I wont waste my time with someone who is clearly only interested in being a pedantic moron.

*DAILY*



*WEEKLY*


----------



## Sean K

tech/a said:


> Kennas you really have to take some time to actually *ATTEMPT* to understand posts.
> I have posted BOTH daily and weekly charts
> The daily is displaying a perfect wave 3 correction to Wave 4 now moving towards wave 5
> The weekly is showing a wave 4
> Both counts are still valid.
> 
> Clearly you have absolutely no idea----thats absolutely no idea.
> Note the two charts See the "W" in the top area and the "D" in the other.
> 
> Mate Ill help anyone who is* GENUINELY* interested but I wont waste my time with someone who is clearly only interested in being a pedantic moron.
> 
> *DAILY*
> View attachment 42514
> 
> 
> *WEEKLY*
> View attachment 42515



I'll skip counting grammatical errors now. Grammar is overrated in the day of txt.

Tech, I love you like a brother mate. Just one with more hair than I, and more styled.

The charts you've posted don't tell us anything about 'practical use'. 

Entry, exit, profit, loss, full justification, live - perhaps. 

I do not care in the slightest if one example fails. I want to see it tested and repeated and how it's practical. If you enter on an EW basis, and that proves incorrect, and then you sell according to EW, then it works!! 

Step up to the plate.


----------



## mazzatelli

Correct me if I'm wrong, but I think tech has already stated that EW is used as his "theme" for other trading signals, rather than micromanagement for entries and exits.

A fundamental data analogy: a macroeconomic model determines a recessionary theme [Duration 6 - 24 months]. This dictates an overall trend to trade e.g. [net] short equities, [net] long fixed income etc

It isn't static like EW [admittedly it doesn't chop and change with the same frequency], as more data/policies releases updates the theme. This model in itself does not provide an entry/exit.


----------



## tech/a

> I do not care in the slightest if one example fails. I want to see it tested and repeated and how it's practical. If you enter on an EW basis, and that proves incorrect, and then you sell according to EW, then it works!!




Your asking me to demonstrate something which I dont use in that way??? 
How clear do I have to make it???
Boggo uses it in a similar way and it works well for him as well.

What about the analysis on the PEN thread that was specific and in real time to PEN?

Hell Im happy to run a few. Doesnt bother me 
ELM is already under discussion.
RRL is also.
Yes to the question
*"Does AGET have RRL in a W.5 with a min target around $2.85 ??"*




Oh and My brother and I should not be left in a room together!
It gets ugly.


----------



## Chris45

Boggo said:


> Does AGET have RRL in a W.5 with a min target around $2.85 ??



I might be doing this wrong but W5 projection is $3.08 to $3.86.

MOB level (probably more significant) is about $2.85.


----------



## tech/a

Chris45 said:


> I might be doing this wrong but W5 projection is $3.08 to $3.86.
> 
> MOB level (probably more significant) is about $2.85.
> 
> View attachment 42525




All legitimate levels.
Chris how do you get so many bars displayed?


----------



## Chris45

tech/a said:


> Chris how do you get so many bars displayed?


----------



## Boggo

Boggo said:


> Trading it, wave 2's are always easier to trade as they tend to form a more symmetrical ABC and the W.3 is the money run.
> I look for similiar in the W.4 and either re-enter when it shows signs of turning at an expected level or wait for a confirmation break of the B if it seems to be a simple ABC rather than a complex pattern.
> Waiting for a break of the previous W.3 high generally looks good but usually has a limited travel (expectation).




Here is an example of why W.4's are often hard work and why I tend to ignore them if there are better options available.

The chart below is RRL, the decision point projected from the top of W.3 gives a worthwhile R/R from the entry at the TS3 buy signal.
Assume that you enter as indicated and the price runs up to greater than 100% initial risk and you move your stop to breakeven.
Then the software detects a reversal of trend and you get a sell signal, the stop eventually gets taken out and you are out at breakeven (ignoring slippage and brokerage for the example) only to see the price continue down but not take out the original stop that was applied when you bought.

The price then continued on its way up and achieved the initial target 

These W.4 situations regularly pose the same questions, ie. should I leave the stop at the original level or move it to breakeven, should I enter at the turn on the "C" ($1.99) as indicated, wait for a close above the "B" ($2.28) or wait for a close above the high of W.3 ($2.46) to enter.

The majority of the time I put W.4's in the too hard basket but in this case of RRL I have done the latter mainly because I am influenced by pattern of the run up and the likely target projections that Chris45 and tech/a have mentioned which are all valid as minimum, typical and maximum targets.

Just my 

(click to expand)


----------



## Boggo

The target areas...

(click to expand)


----------



## Boggo

And to appease the fundies, a fundamentally sound stock (MND) with a bit of tech analysis attached because I couldn't help myself 

tech/a or Chris45, how does AGET treat this ?
On the first chart we seem to have had a 5 wave sequence and an ABC correction that is greater in price and time than any previous correction, next stop to just under $25 ??

Second chart below is from MTPredictor, it picked the turn in a scan a couple of days ago and has placed a R/R on the minimum expectation.
You will note that the count is different on this chart, MTPredictor works back from the last pivot using what they refer to as an "isolation approach", ie. it builds a pattern backwards and sometimes you get this difference.
It is treating this last ABC as a W.4.

Typical target areas on both cases seem to be within 20c of each other though.

(click to expand)


----------



## tech/a

This concurs and probably explains it


----------



## Chris45

Boggo said:


> tech/a or Chris45, how does AGET treat this ?




Boggo, my default GET count seems to concur with your first chart.

MND ticked all of the boxes for a buy on 6-Dec-10 but no trade is being signaled at this time. Fibs seem to be working well!


----------



## Boggo

Thanks guys, looks like its got potential.

Interesting where AGET has plotted the "C" of the W.4 on your chart Chris.
I would have thought it would have been a few days later ?


----------



## Chris45

Boggo said:


> Interesting where AGET has plotted the "C" of the W.4 on your chart Chris. I would have thought it would have been a few days later ?




Yes, that is curious.  I wonder if the fact that the C = 0.618*A might have something to do with it. Quirk of the programming I suppose.

The "Osc 5,35" is similar to a smoothed 5,35 MACD (don't know the exact parameters), but plotted as a histogram instead of a line, and when it turns up from below zero as it did on 6Dec, it seems to give some good buy signals. I think A. Elder uses that concept in his systems.


----------



## Sean K

Still can't see any practical use here. 

EW is only correct in retrospect after being curve fitted with multiple tops and bottoms ignored and can not be applied in real time. 

A nice post from a previous 'practical use of EW' thread.



Frank D said:


> Nick,
> 
> If this is practical Elliot wave then it’s ambiguous at best.
> 
> Take CBA as an example.
> 
> You don’t know C is a wave until price moves away from C, as it isn’t
> hard-coded into the methodology. As most EW traders could, would, or
> might not have done the same thing
> 
> You’ve reacted to the price action and are trading the price action
> rather than using EW to make any entry decision.
> 
> Your entry isn’t based on EW, but rather price action, and now your
> potential target is based on a fibonacci extension pattern.
> 
> In my opinion you’ve just applied different strategies to trade CBA, but
> then optimized Elliot wave into the equation afterwards
> 
> Which makes much more sense to me, and illustrates why EW is
> constantly lagging and being optimized afterwards.
> 
> Then the question begs, why would you use EW in the first place if you
> are relying on other variables to make trading decisions based on entry.
> 
> You might as well just find set-ups in the market, optimize your
> entry strategies and apply fibonacci extensions techniques, instead
> of constantly curve fitting EW.
> 
> It would be make much more sense in saying... "_I use certain trading
> set-ups that are unique to myself and some others, and then I optimize
> my trading using Elliot wave afterwards:- Practical Trading_"
> 
> This is why EW is illusory to the majority because each entry taken is unique the individual trader and then curve fitted to suit the methodology, resulting in different counts and wave structures and confusion based on an individuals interpretation of the trend…..
> 
> Or in your case the trade.


----------



## Boggo

You may have missed this kennas 



tech/a said:


> To those of you who see E/W as of no value great go on and use whatever it is that you use. Your right it has absolutely no value---to you. These posts are there for those---if any--- who wish to investigate further.


----------



## Sean K

Boggo said:


> You may have missed this kennas



We are both wasting our time Boggo, along with anyone else being bamboozled by AGET. 

EW has so far proved to have no practical use at all - IMO!


----------



## colion

In "Dynamic Trading" by Miner there is an interesting bit of Elliott history and philosophy that I think often gets lost.  Here is an excerpt:

"The beauty and significance of R. N. Elliott's work is that he recognized that markets are composed of groups of people that respond as crowd behavior ... This *process* results in a fairly predictable pattern of behavior of cycles of optimism and pessimism.  The process and pattern of behavior is represented on price charts of financial markets, as the price charts are simply reflections of the state of the psychology of the group participating in the market.

Elliott developed his theory over less than a ten year period ...

It is these early works of Elliott that I find most valuable.  Here is found the spirit of the fundamental truths of what Elliott discovered about pattern and process in the cyclical development of the financial markets, unencumbered with the need to explain every little twist and turn on the financial charts.  There were no X waves, no complex corrections, just fives and threes.  Occasionally, a fourth wave traded into the territory of wave one.  Occasionally, a third wave was the shortest impulse wave.  *The form was more important than any rules.*  The process would not be denied.

[In his later works from 1938 - 1946] it became evident that Elliott felt he must show his theory to be right under all conditions, at all times ... we find that he made his theory fit whatever market activity unfolded ... Here we are introduced to thee dreaded X wave ... which mysteriously shows up whenever a market correction does not comply with a three (ABC) or five (ABCDE).  No correction will be denied its count!

It is also during this time that Elliott begins to expound on the Fibonacci number series.  Elliott's knowledge of Fibonacci number and ratio is elementary, at best ... this aspect of market activity was obviously not well thought out or research by Elliott. After what can only be considered a brief study of number, ratio and geometry, Elliott was amazed and thrilled that he had discovered the "secrets of the universe" and the great "laws of nature" ...

What is the point of this brief history of R. N. Elliott?  The practical application of Elliott's Wave Principle to trading and investing decisions has its strengths and weaknesses.  Elliott did not describe a "law of the markets" with inviolate rules.  With a limited history of data and within a fairly short period of time, Elliott recognized an important process that developed in the cycles of market activity.  He recognized that the form of this process was fairly regular, which allowed for a certain degree of predictability and future behavior.  He recognized that markets have a fairly, consistent symmetry of ratio based on the Golden Mean (1.618) ...

Knowledge is never static ... How can we say that Elliott's Wave Principle may also not be as complete and inviolate as some would like us to think? ...

... these rules ... are usually not violated in real-time market activity.  They provide an objective guide to understand market position and to make objective decisions.  Implement the rules in your wave counts.

Occasionally, you will be betrayed by the truth of the market which does not always follow the rules, but more times than not the "rules" will keep your view of the market in proper perspective.

Experience will provide the knowledge and intuition when to break the rules.  But don't be too quick to do so.

If you are going to violate the three so-called "inviolate rules" of Elliott wave analysis, be *consistent regarding these violations.* ... take the rule that a wave four of a five wave impulse sequence may not trade into the price range of wave one.  I only consider that rule violated if the suspected wave four closes within the closing extreme of wave one ... I know of other traders who have thoroughly studied markets and only consider a trade greater than 10% into the wave one range of many markets as a violation of the wave four-wave one overlap rule.

So-called Elliott wave purists, or, as I call them, traditional Elliott wave analysts, would say that expanding the parameters of this rule in either of the above ways is not trading R. N. Elliott's Wave Principle.  I'll let you decide what you want to call it.  The Elliott wave purists are mostly academic advisors who do not apply the principle successfully to their own trading or investing and have generally been creamed in the stock market in the last few years calling the top of the market more frequently than the full moon cycle.

Elliott provided a firm and original foundation for pattern analysis in the markets.  Don't hesitate to expand on Elliott's work when your market research proves it necessary and profitable."


----------



## tech/a

*Colion* 

Yes exactly how those of us apply Elliott see the analysis.

*Kenna's*

Dont waste any more of your time.

As for everyone else.
Wave 5 is well underway.
Posts #99 and #135 were/are on top of it.


----------



## sinner

kennas said:


> We are both wasting our time Boggo, along with anyone else being bamboozled by AGET.
> 
> EW has so far proved to have no practical use at all - IMO!




If you are finding AGET to be bamboozling, I suggest you look into their two most mechanical and simple setups which anyone could implement without even actually requiring AGET.

Chapter 11 here with zillions of examples:

http://www.esignallearning.com/members/getManual.aspx


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## Chris45

*Re: Practical use of Elliot analysis.*



kennas said:


> Great thread tech, but it's going to end in an argument I feel.




Once again kennas, you have made sure it did. Your mission here seems to be "search and destroy".

I would like to see you start a thread "Practical use of Kennas' Analysis" with examples of your 'live' (as in before the fact) analysis of stocks so we can see how your methods work. To his great credit, Frank D does it.

I'm guessing it's not going to happen.


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## Boggo

*Re: Practical use of Elliot analysis.*



Chris45 said:


> Once again kennas, you have made sure it did. Your mission here seems to be "search and destroy".
> 
> I would like to see you start a thread "Practical use of Kennas' Analysis" with examples of your 'live' (as in before the fact) analysis of stocks so we can see how your methods work. To his great credit, Frank D does it.
> 
> I'm guessing it's not going to happen.




There are about half a dozen of these enlightened folk who appear on every thread that is associated with anything more complex than a moving average crossover as that seems to be the limit of their ability.

They remind me a bit of some of the military trained personnel that I work closely with.
They have spent so many years believing that they have been taught everything there is to know and if they haven't been taught and they don't understand it then its fertiliser.
I am talking 'Top Gun' level people here, very talented but a mindset that is set in stone when it comes to thinking outside the square.

As tech/a mentioned earlier, in the case of this thread I do wish that they would just not disrupt what is being discussed if they do not understand it.

Rant over.


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## namrog

I've been following this thread and have to say it's been both educational and entertaining ..but to say that those that do not understand are being disruptive is a bit one eyed.
How boring and pointless would it be if only those that understand contribute to the thread, would be like preaching to the converted,  indeed it usually takes those that don't understand by their asking of questions that the discussion opens up ..
So whether you agree with him or not I think Kennas has every right to participate, and why not prove his doubts on elliott wave wrong by giving him the live calls he is asking for... 
I have to declare that I sit on the fence somewhat when it comes to EW, am happy enough to use it when I see it clearly on a chart, I don't use it on it's own, but along with other analysis, it does give me confidence that I'm on the right track ..

Also agree we are in wave 5...

Hope to see the thread continue, have appreciated all contributions ..

Sorry for the spelling and grammer Kennas...


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## sinner

Another great example of "Practical use of Elliott Wave analysis" is a resource released a while ago by Elliott Wave International, called "How to use bar patterns to spot trade setups".

Now, the thrust of the document is not really about EW, but the author Jeffrey Kennedy shows how he combines these simple bar patterns in his broader EW analysis. e.g. if he's looking to enter a wave 3 up he will use a bar pattern with bullish bias to enter. 

But the proposed wave 3 up is his main *trend/cycle* signal! And the proposal can be either by an algorithmic software package like AGET, or it can be by your brain. Either is fine!

I use a intraday breakout myself, finding it meshes better with EW principles (imho only), but whatever. AGET setups posted in "Chapter 11" above use schaff channel breakouts. The idea is to get into a wave 3 or wave 5 movement, and however you do that is fine.

Can you see in the below screenshot, a popgun is printed just after the wave 4 low in the first (hourly) chart? Jeffrey Kennedy shows the popgun which leads to wave 3, but you can see another has developed heading into wave 5! This is a great example of using price action setup to enter into a proposed Elliott Wave.

Just google the title and author, it's a free resource.


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## Sean K

*Re: Practical use of Elliot analysis.*



Chris45 said:


> Once again kennas, you have made sure it did. Your mission here seems to be "search and destroy".
> 
> I would like to see you start a thread "Practical use of Kennas' Analysis" with examples of your 'live' (as in before the fact) analysis of stocks so we can see how your methods work. To his great credit, Frank D does it.
> 
> I'm guessing it's not going to happen.



Read my ADF Blog back over the past 4 years. In 'positions' there are 21 pages back to 2007.


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## Chris45

*Re: Practical use of Elliot analysis.*



kennas said:


> Read my ADF Blog back over the past 4 years. In 'positions' there are 21 pages back to 2007.




Link please?


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## Sean K

*Re: Practical use of Elliot analysis.*



Chris45 said:


> Link please?



Ha! 

Sorry, that's ASF Blog.

https://www.aussiestockforums.com/forums/blog.php?u=3610


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## sails

*Re: Practical use of Elliot analysis.*



kennas said:


> Ha!
> 
> Sorry, that's ASF Blog.
> 
> https://www.aussiestockforums.com/forums/blog.php?u=3610




 I'm sure that ADF would be typed as easily as ASF...


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## Chris45

*Re: Practical use of Elliot analysis.*



kennas said:


> Ha!
> 
> Sorry, that's ASF Blog.
> 
> https://www.aussiestockforums.com/forums/blog.php?u=3610




I scrolled back and read Sep and Oct-07 entries. Your blog seems to be mainly just bought this, sold that, plus some lifestyle stuff and not much in the way of discussion of stock analysis before the action. Is that as good as it gets or do you go into details of your analysis somewhere else? A thread would certainly be much easier to follow than the blog.


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## Porper

colion said:


> It is these early works of Elliott that I find most valuable.  Here is found the spirit of the fundamental truths of what Elliott discovered about pattern and process in the cyclical development of the financial markets, unencumbered with the need to explain every little twist and turn on the financial charts.  There were no X waves, no complex corrections, just fives and threes.  Occasionally, a fourth wave traded into the territory of wave one.  Occasionally, a third wave was the shortest impulse wave.  *The form was more important than any rules.*  The process would not be denied.




Good post colion. I find his earlier work much more useful than the amended version by Prechter etc. Miner is much less stringent and aligns much more with the time aspect which is an added bonus.

One of Elliott's earlier quotes to Collins sums it up well.

"I consider it far more important to know when the terminals are actually reached than to hazard a guess"

People will read into this what they will but it is very apt i.m.o.


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## tech/a

Well it appears Kenna's seems to be with the minority who struggle with the Practical use of Elliott.

I know what Kennas wants to see.
Elliott used as a stand alone analysis tool which gives (In real time) Entries and Exits.
I dont know of any trader who actually trades that way.
I know many who trade with other tools as already mentioned.

EVEN AGET
Has 5 main trading methods which use confirming signals to trade.

I'm happy to run some trades based upon those.
If anyone is interested.
It will be about as close as you can get Kennas to Just Elliott.


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## IFocus

tech/a said:


> Well it appears Kenna's seems to be with the minority who struggle with the Practical use of Elliott.
> 
> I know what Kennas wants to see.
> Elliott used as a stand alone analysis tool which gives (In real time) Entries and Exits.
> I dont know of any trader who actually trades that way.
> I know many who trade with other tools as already mentioned.
> 
> EVEN AGET
> Has 5 main trading methods which use confirming signals to trade.
> 
> I'm happy to run some trades based upon those.
> If anyone is interested.
> It will be about as close as you can get Kennas to Just Elliott.




I think you are being baited by some one carrying the burden of pass conflicts, you have nothing to prove Tech and personally disgusted by those that turn up here with demands of those that are not selling product etc putting enormous time and effort but with little or nothing to show themselves.

I could understand if you guys were pushing EW as the be all and end all but you're not.

Don't get sucked in by others agendas.


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## tech/a

Mate its no problem.
I can actually trade so it doesn't bother me!!

I'm just showing what I do.


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## Chris45

Tech, I agree with IFocus and ask that you please *IGNORE* kennas and the other naysayers and keep posting. I have learned much from your posts and I only wish I had discovered you and ASF a couple of years earlier. *This post* still sticks in my memory as one of the most remarkable on this forum and if some people can't see that as an indication of the power of EW & your ability with AGET, then they are idiots.


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## GreedFear&Hope

I also agree that this is and has been a very educational and enjoyable thread.
It is a shame that this thread is going down a familiar path and turning hostile.


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## tech/a

No problem will carry on regardless.
You'll have to put up without me though end of May to Mid July.
Off to Europe and play time.


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## Sean K

Chris, go back and read the blog properly and the individual stock threads at the time. 



Chris45 said:


> I have learned much from your posts and I only wish I had discovered you and ASF a couple of years earlier. *This post* still sticks in my memory as one of the most remarkable on this forum



I think you should study that chart again Chris. 

Definition of hostility to an EW'er?

Questioning EW.... 

No more questions.


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## Boggo

For notting from RED thread.
I have two lots of software that automatically project target areas from current pattern based on the guidelines below (bold text being the ideal and most likely).
It can be done with any software that has Fibonacci projection ability.


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## notting

Boggo said:


> For notting from RED thread.
> I have two lots of software that automatically project target areas from current pattern based on the guidelines below (bold text being the ideal and most likely).
> It can be done with any software that has Fibonacci projection ability.




Thanks Boggo.


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## joea

In the Jul/Aug YTE magazine there is an article on "Elliott Wave Forex Trading." by Peter Mathers of Trading Lounge.

I will quote a few lines..
Using Fibonacci retracements and extensions can be very accurate - or not, so its also a technical analysis guideline.
However, if used with Elliott Wave, Fibonacci will start to strengthen your analysis....

... Trading levels can be a tool to strengthen your trading. They are unique in that they integrate Elliott Wave and Fibonacci and include trading psychology.
Trading levels offer exact price points to operate from, which is the most valuable element of all....

.... Trading levels are price points used as support for entry and to strengthen the point of entry when using Elliott Wave. Trading levels are used as target price points at which to exit, because we can expect that other traders
will be thinking of certain numbers and taking profit. The number '1' is the strongest number in the market, followed by 5.

To fully understand, the complete article needs to be read.
I use the Waves(5) suggested by Miner in his book(High Probability Trading Strategies), together with Fibonacci education from "Fibonacci Trading"
by Boroden. 

cheers joea


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