Disliked{quote} GU, finally picked me up {image} Edit : add text & pic {image} 2 entries left AJ+GU, quite tiring work today, have a nice weekend everyoneIgnored
some newbie question on the weekends, after doing some research on Waves.
My focus will be on Wave 2, that usually retraces more than 62% of wave 1... ( i've studied lot of charts on this)
This is precisely true to almost all wave 1.
It relates to the psychology of traders & the market...
Wave 1 emerges from huge pessimism (If the market is in a downtrend)...
The market is bleeding, going down day after another, and then a rally occurs...
People being convinced that the status is a bear & that the trend is a down one, heavily sell the rally, bringing the price down as hell with retracement usually over 62% (In fact I studied several wave 1s and found that wave 2 usually retraces anywhere between 70-80% of wave 1, sometimes more, sometimes less, but this is the percentage retracement in 80% of wave 1s).
However, even with people selling like hell and bringing prices down buyers emerge once again & take prices up in wave 3 where people start to see weakness turning into strength & the market confirms the reversal...
Appreciate your view on this.
Gracias Compañero
PAT
I come from the future.
3