The Elliott Wave debate

lukeaye · 12 September 2009

Let me give you another example, if you were using an RSI indicator atm, or some other momentum indicator, it would have showed that everything is very heavily overbought, does that mean you would have being taking shorts the last 3 weeks? heck no, thats not to say the indicator is rubbish, or im never going to use it, but right now its not giving me any high probability indications, but given different coniditions it can be very accurate, i just think what your saying is too 1 dimensional, not trying to be personal, but that is my view. It is not as simple as yes or no, or black or white.

tech/a · 12 September 2009

Let me give you another example, if you were using an RSI indicator atm, or some other momentum indicator, it would have showed that everything is very heavily overbought, does that mean you would have being taking shorts the last 3 weeks?

If you did take a short based upon the above it would clearly indicate a complete misunderstanding of how to use the RSI or any other momentum oscillator.

Trembling Hand · 12 September 2009

lukeaye said:
but given different conditions it can be very accurate,

Yes like in hindsight. 100%.

lukeaye said:
i just think what your saying is too 1 dimensional, not trying to be personal, but that is my view. It is not as simple as yes or no, or black or white.

What am I saying lukeaye. You have seemed to figure me out in 2 days. Very good no wonder you can make Gann & EW "work".

Looking forward to a couple of traded examples, about 50 would show us the truth.

lukeaye · 12 September 2009

Trembling Hand said:
Yes like in hindsight. 100%.

What am I saying lukeaye. You have seemed to figure me out in 2 days. Very good no wonder you can make Gann & EW "work".

Looking forward to a couple of traded examples, about 50 would show us the truth.

no it wasnt directed at you TH, i was saying the other reply was 1 dimensional, i just dont think you can say its wrong or right in that way. im not on the elliot wave band wagon at all.

hahah, yeah i dont think ive placed 50 gann trades, the system i use, to give me 50 trades would take probably 2 or 3 years. But ill admitt, it is not 100% right, if anyone has something 100% please let me know! hahaha.

PS what do you mean ive figured you out?

lukeaye · 12 September 2009

tech/a said:
If you did take a short based upon the above it would clearly indicate a complete misunderstanding of how to use the RSI or any other momentum oscillator.

agreed, im not saying i am, im just pointing out common sense, the same is true of elliot wave theory, if it isnt showing the correct conditions for elliot wave, then dont use it, but there are definantely times when it is true.

AND one more time IM not an elliot wave groupie.

tech/a · 12 September 2009

lukeaye said:
Look, elliot wave theory is very hard, and subjective to follow and label, but there are definite positives to be taken from the theory.

Elliott is a methodology not a theory it has clear rules.

I would never trade, purely on an elliot wave theory, it is in my opinion, not a strategy with a high probabilty of sucess, but when used with other techniques can become very powerful.

And you know this from extensive testing or walk forward trading?

I believe that you can take positive/negatives from every theory. It is easy to critize and dismiss a theory that you believe to be wrong, but its it is smarter to listen, learn and develop from it.

Theories can be proven wrong.
IE "You havent made a loss until you sell".

In any case, the only thing that makes theory correct or incorrect, is other people obeying the same theory, so theorys are self perpetuating.

A theory is a theory an hypothesis,thoeries are for pondering,testing and investigating,not acting upon.

What makes elliot wave theory hard to self perpetuate, is that the labeling of waves is subjective. For example, what i call an A wave you may call wave 2, or what i call an a-b-c correction you can wave 1-2-3. Therefore the theory is very hard to perpetue with great sucess.

Elliott is rule based clearly you dont understand the rules. It is common for those who arent versed in Elliott to "Theorise" as you have.

theorys such as support and resistance are perpetuated with easy because everyone here knows how to identify them and everyone will follow them!

(In Black) So support and resistance work 100% of the time?

Im going to duck for cover as i say this, because not everyone will accept what i say.

Why should we?

Contrary to this rule, there are mathamatical anamolys which occur in different stocks, which can be traded with a high probabilty of sucess, Gann spoke of them but did not reveal them, but i can vouch from how they are traded, because i have seen people discover these and have used them, and backtested them.

Excellent would love to see these results.

No single theory can be called wrong or stupid, because it is a theory, and in certain situations, any theory could be correct. Only ignorant people will say that a theory is BS or that is a load of crap, a theory is correct until it is not.

The qualities of a deep thinker. Theories can be proven incorrect as Hawkings Black hole theory was proven--incorrect. Acting upon theories can be hazzardous.

A Good trader will adapt and develop his theories based on what the stock or index says to you, let it speak to you. Becuase you may find you have an elliot wave channel,

What is an Elliott Wave channel!

or a fibonacci cluster, if you do, trade it! Neven let the theory dictate to you what the stock or index should do.

Interesting thinking. It would then indicate that the thoery should be ignored (Neven let the theory dictate to you what the stock or index should do)--but trade it anyway.

Why would a good trader , trade using theories? Theories dont have known outcomes--by definition.

This is my opinion, and im not have a go at anyone, so dont throw darts at my head! haha

Thank goodness I'm really sensitive.

lukeaye · 12 September 2009

Support and resistance is true until it is not, that is my point?

And i can prove my theory, i will post later one i use for NCM

Im aware of the elliot "rules" but if you have ever used elliot wave you will know that most of the time, you can only label correctly in hindsight, obviosuly you have never done it. It is very common for 1 of 3 things to occur, which is what makes it so subjective, trust me i have studied with some the best elliotions, and it is never that clear cut.

You have obivously taken this very personally tech, that was not my intention.

And yes what i am saying is use the theories and indicators as an aid, to increase your probability of sucess, in conjuction with other things, but never make a trade based on a theory and dispel other evidence.

wayneL · 12 September 2009

corn:

Boggo · 12 September 2009

Trembling Hand said:
Looking forward to a couple of traded examples, about 50 would show us the truth.

I can start the ball rolling there TH, not going to do 50 (don't know why I am even doing one ).

The method does work guys, but it does help when you have software that helps you find potential candidates.
You still have to be able to glance at a chart and see a pattern or a repeat of a previous pattern before committing serious money to it.

There has been some spectacular examples lately, CBA RCR MCR(which I didn't have the funds for at the time ) are just three that come to mind.
There have been a few failures too but the stops have contained those.

I currently hold three stocks based on the method.

Overall it is profitable for me, there is no doubt that it works, human behaviour patterns do repeat and are predictable and that is really the foundation of the concept.

GBG example below for TH

(click to expand)

Boggo · 12 September 2009

wayneL said:
corn:

I am on the couch with Wayne from here on while the recently deceased equine incurs a few more whip marks

:horse:

opcorn:

.

motorway · 12 September 2009

Boggo said:
I can start the ball rolling there TH, not going to do 50 (don't know why I am even doing one ).

The method does work guys, but it does help when you have software that helps you find potential candidates.
You still have to be able to glance at a chart and see a pattern or a repeat of a previous pattern before committing serious money to it.

There has been some spectacular examples lately, CBA RCR MCR(which I didn't have the funds for at the time ) are just three that come to mind.
There have been a few failures too but the stops have contained those.

I currently hold three stocks based on the method.

Overall it is profitable for me, there is no doubt that it works, human behaviour patterns do repeat and are predictable and that is really the foundation of the concept.

GBG example below for TH

(click to expand)

The question is what tool best reveals the BOLD
in ALL cases

I go to sidelines too

But leave with these POINTS

mkts are a JUMP DIFFUSION PROCESS

Time is Not continious BUT discrete

hence use of time frames leads to two errors

distraction ( empty noise ( as empty SPACE )as timeframe is reduced )
Oblivion ( blurring of Signal as time frame increased )

( trading ) time is discrete
price is continious

here is chart of correct type then

Any number of entry zones
since the bottom
clear as clear as clear

no elliot waves
they only are produced by the distorting lens of time frames
as are all things derived from time frames

Support is Support
Resistance is resistance
When viewed from outside time frames
and one dimensional charts and their distorting lens

yes markets are different
some trend and then congest
some congest and then trend

There is only ONE thing that needs testing
Once you remove time frames

What trends are probabilty Distributions

and not through timeframes
But through trading ( discrete ) time

motorway

tech/a · 12 September 2009

lukeaye said:
Support and resistance is true until it is not, that is my point?

So is everything else.

And i can prove my theory, i will post later one i use for NCM

Sample size 1 = proof---interesting.

I'm aware of the Elliott "rules" but if you have ever used Elliott wave you will know that most of the time, you can only label correctly in hindsight, obviously you have never done it.

Clearly.

It is very common for 1 of 3 things to occur, which is what makes it so subjective, trust me i have studied with some the best elliotions, and it is never that clear cut.

The 3 things being?
True for those not conversant expert or otherwise it isn't clear cut.
There are many "Expert Elliotians" out there who couldn't trade to save themselves.

You have obviously taken this very personally tech, that was not my intention.

Which part of sensitive didn't you understand?

And yes what i am saying is use the theories and indicators as an aid, to increase your probability of success, in conjunction with other things, but never make a trade based on a theory and dispel other evidence.

Interesting--when does a theory become "Other Evidence?"
How do you know anything increases probability?

I thought you'd be a more formidable adversary than that!

Aww common guys your no FUN!!! (M/W,Boggo!).

Helped you out with the spell checker!

Trembling Hand · 12 September 2009

Boggo said:
I can start the ball rolling there TH, not going to do 50 (don't know why I am even doing one ).

There has been some spectacular examples lately, CBA RCR MCR(which I didn't have the funds for at the time ) are just three that come to mind.
There have been a few failures too but the stops have contained those.

Overall it is profitable for me, there is no doubt that it works, human behaviour patterns do repeat and are predictable and that is really the foundation of the concept.

GBG example below for TH

See Boggo this is BS. Its an obvious fraud to post some trades. That is the Gurus trick. Posting a trade that's now 15 days old is a joke. The only real valuation of a method is after a decent sample of all the actually trades taken. Or doing 50, 100, 200 etc in real time.

Nothing is proven with 1 example taken in isolation. I can give you three from yesterday where I top or bottom picked the HSI and road the wave right to the other side and then got out a couple of ticks from the end. Brilliant trades. Made lots in those individual trades. My method/system obviously "works". only trouble is I lost 2 grand yesterday.

lukeaye · 12 September 2009

Here is a real time trade, that i was looking at a few days ago.

I really couldnt be bothered arguing with you tech. my trading is succesful, thats all the proof i need, and i hope you are succesful too, whatever system works and makes you money day in day out regardless or market conditions is a good system in my book, elliot or whatever you want to do.

i can give you 10 real time trades right now if you want

nunthewiser · 12 September 2009

intresting stuff

its good to see everyones a winner

oops except TH who lost 2k the other day

motorway · 12 September 2009

Getting Stopped is OK

But the main point is what reveals the dynamics best

and avoids time frame induced false break and signals

and To buy that first break is not maybe the optimum BUY

You still look for the test
or what de villiers
would say
is you don't buy the mid pattern rally
but in the re test on the base
or at the first true catapult

and Now we get into
more sophisticated entry technique ( off topic )
Which revolves around acceleration
off support
and use of nested scales ( smaller Box size when the divergence occurs )

and then of course there is volume

The main point is what reveals
the current probabilities with the greatest clarity
and keeps you as much as possible on the right side of them

Support jumps lower and lower
until it doesn't
and then it starts jumping higher and higher
in between jumps
there is the diffusion

Joseph hart ( studied Wyckoff )

put it like this

Stocks move abruptly into place
and steadily in place

spring board
dead centre
no supply
no demand

volume follows price
and price follows volume (depends if you look back or look forward )

volume is being defined by the reversals themselves
to significant extent ( such P&F so it is said can ignore volume )
but we do not have to,,,

motorway

lukeaye · 12 September 2009

Another one im in, elliot wave theory has worked for this stock for the last 5 years, as im saying doesnt work for all, but the ones it does work for, it works well.

I guess the proof will be in the pudding in a few week once it all unfolds.

lukeaye · 12 September 2009

And another tell me when to stop

nunthewiser · 12 September 2009

wow

great charts bud

are you actually trading any ?

tech/a · 12 September 2009

T/H
Many moons ago you posted a scatter chart showing a days trading.From that it clearly showed that the 4 or so big winners gave you an edge over the lots of small losses and smaller wins. Not a critisism but an observation.
Is this true in the long run with your trading?

Thanks Lukaye--compelling stuff. But your charts are rubbish.

M/W yes understand.

Just noticed this re volume you may comment on.(Using GBG as an example seen on most stocks.)

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