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-   -   Neowave and Glenn Neely (https://www.forexfactory.com/showthread.php?t=10696)

clam61 Nov 27, 2006 2:35pm | Post# 1

Neowave and Glenn Neely
 
I recently acquired his book on mastering elliot waves.

only on the 3rd chapter, but i see he has taken a lot of subjectivity out of EW theory.

has anyone had experience using his techniques on Forex? One thing that is great about his book is that he addresses special considerations to be used on global markets such as forex.

jjenkin777 Nov 29, 2006 6:01pm | Post# 2

I recently acquired his book on mastering elliot waves.

only on the 3rd chapter, but i see he has taken a lot of subjectivity out of EW theory.

has anyone had experience using his techniques on Forex? One thing that is great about his book is that he addresses special considerations to be used on global markets such as forex.
I just finished chapter 2 myself and will be reading chapter 3 tonight. Did his discussion on selecting data and plotting monowaves in chapter 2 concern you? If this is a requirement as opposed to looking at regular charts I am a little concerned on how we get and process data. It looks like I can do this in Excel with a data dump to a text file from a chart package.

Jeffrey

clam61 Nov 29, 2006 6:55pm | Post# 3

hi im on chapter 3.

im in the process of making an indicator that plots data according to what he said about Forex.



I just finished chapter 2 myself and will be reading chapter 3 tonight. Did his discussion on selecting data and plotting monowaves in chapter 2 concern you? If this is a requirement as opposed to looking at regular charts I am a little concerned on how we get and process data. It looks like I can do this in Excel with a data dump to a text file from a chart package.

Jeffrey

wwwin Nov 29, 2006 7:33pm | Post# 4

Have read the book
 
I recently acquired his book on mastering elliot waves.

only on the 3rd chapter, but i see he has taken a lot of subjectivity out of EW theory.

has anyone had experience using his techniques on Forex? One thing that is great about his book is that he addresses special considerations to be used on global markets such as forex.
Almost finished reading the book.

wwwin Nov 29, 2006 7:36pm | Post# 5

Same here
 
I just finished chapter 2 myself and will be reading chapter 3 tonight. Did his discussion on selecting data and plotting monowaves in chapter 2 concern you? If this is a requirement as opposed to looking at regular charts I am a little concerned on how we get and process data. It looks like I can do this in Excel with a data dump to a text file from a chart package.

Jeffrey
That average price for data has slowed me down too.

clam61 Nov 29, 2006 8:10pm | Post# 6

actually i am not using average price. i am taking the high and low for that day, plotting in the order it came first. according to him, this iwas the better option

wwwin Nov 29, 2006 8:21pm | Post# 7

yes
 
actually i am not using average price. i am taking the high and low for that day, plotting in the order it came first. according to him, this iwas the better option
Yes you are correct, he said that was the better option. I had in my mind the average b/c it would be easier on MetaTrader to do.

jjenkin777 Nov 29, 2006 11:29pm | Post# 8

Well, after three hours of serious concentration, I got through the first thirty pages of Chapter Three. I can see where this is going as far how to properly define where you are at in a wave structure, but getting these rules to properly define a monowave is meticulous. I am going to have to read these thirty pages over again tomorrow just to make sure I am clear about it.

Back to the discussion on Chapter Two and collecting and plotting data. I am having to export from a chart package and import into excel to manipulate the data and create charts. How are you guys doing this exactly?

Thanks
Jeffrey

clam61 Nov 29, 2006 11:31pm | Post# 9

jeff, i wouldnt worry about memorizing it

when it comes time to analyze, simply look at the book while you are working. after a while, you'll remember most of it

i have an indicator that is helping out a lot

btw, check your PM

Well, after three hours of serious concentration, I got through the first thirty pages of Chapter Three. I can see where this is going as far how to properly define where you are at in a wave structure, but getting these rules to properly define a monowave is meticulous. I am going to have to read these thirty pages over again tomorrow just to make sure I am clear about it.

Back to the discussion on Chapter Two and collecting and plotting data. I am having to export from a chart package and import into excel to manipulate the data and create charts. How are you guys doing this exactly?

Thanks
Jeffrey

clam61 Dec 1, 2006 4:42pm | Post# 10

1 Attachment(s)
ok this is my first neely question and its a pretty fundamental question:

After gathering your data points, do you plot them on a chart and then mess around with the scale on the whole chart so that every piece of directional and non directional action on every level satisfies the Rule of Proportion simultaneously using that same scale? If so, it could be very difficult to make all pieces of price action fit. it would also cause you to possibly update your chart with every new data point. somehow i dont think this is what you are supposed to do

If not or you don't know what Im talking about could you go through the process of applying Rule of Proportion and Rule of Neutrality. Dont need to go into the rule itself, but more of what waves to apply it to
Name:  neely.GIF
Views: 12783
Size:  14 KB

Dick Dec 3, 2006 4:33am | Post# 11

I looked at this a while back and came to three conclusions:

It is sufficently complex that you can make consistent mistakes and never know it.

You can never figure out if you are doing it wrong or if the system itself is flawed.

It makes my head hurt.

Dick


Incompetence is a double-edged banana.

smjones Dec 3, 2006 8:50am | Post# 12

Yes, Glenn's work is very comlex to say the least. However, much of his approach, especially the material in chapter three can be programed into a good charting package like Tradestation, MT4 or Amibroker.

The use of the Rule of proportion and the rule of neutrality and the use of the monowave structure, and the use of m1,m0,m2 is a very objective approach.

Subjectivity in Elliot wave has always been a problem for me to get my head around. Neely has applied a scientific approach and has removed much of the subjectivity.

Just like anything else that is complex, such as mathematics, where you go from Algebra to Geometry to Trigonometry to Calculas, to advanced appilaction, this requires one to build their knowledge base slowly and completely before advancing to the next level.

I have been very impressed with the approach so far. It is daunting, but it seems to be worth the effort. This is coming from a person who does not have a lot of faith in Elliot Wave...

I will come back and report again in a year after I understand it completely...


I looked at this a while back and came to three conclusions:

It is sufficently complex that you can make consistent mistakes and never know it.

You can never figure out if you are doing it wrong or if the system itself is flawed.

It makes my head hurt.

Dick


Incompetence is a double-edged banana.

smjones Dec 3, 2006 9:00am | Post# 13

Clam, Is it an optical illusion? or are none of your boxes squares? It looks like the are elongated. Anyway, I think he said to draw a 90degree vetical and a 0 degree horizantal and then use that to see if you can apply the RoN.
I am not sure of the question you are asking, but it looks to me like you are trying to decide on applying RoN on more than one Monwave at a time.. This would not be correct. So I would say, look at the first box and decide if the RoN applies and then move on to the next larger set.

If this is not what you are asking, maybe you could rephrase your question..




ok this is my first neely question and its a pretty fundamental question:

After gathering your data points, do you plot them on a chart and then mess around with the scale on the whole chart so that every piece of directional and non directional action on every level satisfies the Rule of Proportion simultaneously using that same scale? If so, it could be very difficult to make all pieces of price action fit. it would also cause you to possibly update your chart with every new data point. somehow i dont think this is what you are supposed to do

If not or you don't know what Im talking about could you go through the process of applying Rule of Proportion and Rule of Neutrality. Dont need to go into the rule itself, but more of what waves to apply it to

wwwin Dec 3, 2006 12:51pm | Post# 14

Ew
 
I looked at this a while back and came to three conclusions:

It is sufficently complex that you can make consistent mistakes and never know it.

You can never figure out if you are doing it wrong or if the system itself is flawed.

It makes my head hurt.

Dick


Incompetence is a double-edged banana.

I bought the pound on 11/24/06 at 1.9320 mostly based on EW and some technical analysis, but mostly my believe that W3 had just started. Althought I am just learning Neely, I had read EW Principle before. EW is not a entry/exit system, it is a forecasting tool. It does not tell you to enter or exit at specific prices, it gives you probabilities and direction of market. I would say 500 pips in a week is worth a little headache. If you don't believe me, go to this posted on 11/24/06
http://www.forexfactory.com/forexfor...707#post145707
Even though I hardly know the Neely method, I just went to appropriate parts of book and that helped me or at least gave me confidence to place the trade. You don't have to get lost in every minute detail of the book to make it useful. It would take many months to learn all this.


"You can never figure out if you are doing it wrong or if the system itself is flawed." If you forecast a big move up, and it happens, would that not tell you that you are doing it right? Or at least that you got it right that time? It is not a system, it is a forecasting tool. If you want a system that would tell you at what price to enter/exit, in other words, no work on your part involved, this is not for you. But I dare you to tell me which system can do that and not be flawed. It is not possible, by definition such system is doomed to fail. It is the subjectivity of EW that makes it long lasting, it allows for changes as changes take place. MECHANICAL SYSTEMS ONLY WORK WHILE THE SAME DYNAMICS EXIST AS AT THE TIME THE SYSTEM WAS DESIGNED. ONCE THAT CHANCES, THE SYSTEM DOES NOT WORK, AND IT MAKES YOU LOSE MONEY INSTEAD.

clam61 Dec 3, 2006 4:13pm | Post# 15

very true scott.

chapter 3 is complicated, but the thing is that yo dont need to memorize the rules, you can take your time unless your trying to analyze 15 minute charts!. if you are charting daily or weekly, simply use the book as a guide while anlalyzing every day or week

Yes, Glenn's work is very comlex to say the least. However, much of his approach, especially the material in chapter three can be programed into a good charting package like Tradestation, MT4 or Amibroker.

The use of the Rule of proportion and the rule of neutrality and the use of the monowave structure, and the use of m1,m0,m2 is a very objective approach.

Subjectivity in Elliot wave has always been a problem for me to get my head around. Neely has applied a scientific approach and has removed much of the subjectivity.

Just like anything else that is complex, such as mathematics, where you go from Algebra to Geometry to Trigonometry to Calculas, to advanced appilaction, this requires one to build their knowledge base slowly and completely before advancing to the next level.

I have been very impressed with the approach so far. It is daunting, but it seems to be worth the effort. This is coming from a person who does not have a lot of faith in Elliot Wave...

I will come back and report again in a year after I understand it completely...

clam61 Dec 3, 2006 4:15pm | Post# 16

hi scott, thanks for trying to answer it.

yes my boxes could not be squares...i just drew them quickly to illustrate my point.

what im actually asking is WHERE do you apply teh rule of proportion?

do you apply it to the whole chart or to individual pieces of directional and nondirectional price action seperately.


Clam, Is it an optical illusion? or are none of your boxes squares? It looks like the are elongated. Anyway, I think he said to draw a 90degree vetical and a 0 degree horizantal and then use that to see if you can apply the RoN.
I am not sure of the question you are asking, but it looks to me like you are trying to decide on applying RoN on more than one Monwave at a time.. This would not be correct. So I would say, look at the first box and decide if the RoN applies and then move on to the next larger set.

If this is not what you are asking, maybe you could rephrase your question..

clam61 Dec 3, 2006 4:23pm | Post# 17

1 Attachment(s)
here scott

take a look at the pic. hope it clears things up
Name:  neely.GIF
Views: 7948
Size:  5 KB

smjones Dec 3, 2006 5:24pm | Post# 18

Hmm, Tough question, I am going to have to go read the first part of chapter three again. get back in a few..
here scott

take a look at the pic. hope it clears things up

Sanook Jun 2, 2007 8:28am | Post# 19

Hi,

I've just discovered this type of Elliott Wave analysis, and was wondering what the original posters in this old thread, came to with regards to conclusions about the method etc?

Thanks.

bluebuddha Jun 2, 2007 9:44am | Post# 20

here scott

take a look at the pic. hope it clears things up
Both. One should be the fractal of the other.

smjones Jun 2, 2007 9:57am | Post# 21

Well I have read the book a couple of times and find the concepts overly complex... I am not a Elliot theorist, so I stepped out of the discussion. I have no doubt Neely is a very brilliant person. I just found the concepts too esoteric for me to apply.

Balflear Jun 2, 2007 12:20pm | Post# 22

Well I have read the book a couple of times and find the concepts overly complex... I am not a Elliot theorist, so I stepped out of the discussion. I have no doubt Neely is a very brilliant person. I just found the concepts too esoteric for me to apply.
Say Scott,

Do you have or know any mt4 indicator that create the neowave chart?

I only know how to do it in ms excel.

Sanook Jun 8, 2007 6:35am | Post# 23

Well I have read the book a couple of times and find the concepts overly complex... I am not a Elliot theorist, so I stepped out of the discussion. I have no doubt Neely is a very brilliant person. I just found the concepts too esoteric for me to apply.
Thanks for the reply.

I'm going to continue to plod through the book, and I agree it's very complex, so complex I'm not even sure how to plot the charts properly!!! I'm not too sure why people keep mentioning the need to use Excel. The way I've read the plotting section, it seems viable to use a 4h chart and simply plot the high and low of the day, in the order they appeared. This would give you two data points for a daily chart.

The next part for me seems to be the most tricky. To get the rule of proportion in MT4, could I simply adjust the scale of the chart until the data fits inside a perfect square. But then, is there a way of drawing a perfect square within MT4. On graphics programs I'm used to holding down the shift key to draw a square, but it doesn't work with MT4.

Thanks.

Balflear Jun 8, 2007 8:21am | Post# 24

Thanks for the reply.

I'm going to continue to plod through the book, and I agree it's very complex, so complex I'm not even sure how to plot the charts properly!!! I'm not too sure why people keep mentioning the need to use Excel. The way I've read the plotting section, it seems viable to use a 4h chart and simply plot the high and low of the day, in the order they appeared. This would give you two data points for a daily chart.

The next part for me seems to be the most tricky. To get the rule of proportion in MT4, could I simply adjust the scale of the chart until the data fits inside a perfect square. But then, is there a way of drawing a perfect square within MT4. On graphics programs I'm used to holding down the shift key to draw a square, but it doesn't work with MT4.

Thanks.
Could you elaborate more on the plotting using 4h chart?
A screenshot would be nice.

zebra7860 Jun 8, 2007 8:25am | Post# 25

don't waste your time
 
Guys,

I read the book 5 times and spent two years studying Neely's Neowave. It's a waste of time. Just pay attention to the different :5 and :3 patterns he depicts near the middle/end of book. Forget chapter 2. After you read the book and try and apply it you will realize how futile it is to count each and every wave. Better to get Mike Jenkins' book, "Chart reading for professional traders". A Gem. Masterpiece. There is ONE page in the book that has 10 patterns which summarizes all the available patterns out there. That is all you need.

Al

Sanook Jun 8, 2007 11:08am | Post# 26

1 Attachment(s)
Could you elaborate more on the plotting using 4h chart?
A screenshot would be nice.
Sure. On page 2-10 he says, "If you want a little more daily detail......or you can use the high and the low for the entire day and plot them in the order they occurred (this last approach is the best)".

The grey vertical lines are day separators. I've also removed some points to clean up the chart.

Thanks.
Name:  Neowave.jpg
Views: 4829
Size:  15 KB

Far From Average Jun 8, 2007 10:33pm | Post# 27

If you forecast a big move up, and it happens, would that not tell you that you are doing it right? Or at least that you got it right that time?
Actually, no, it wouldn't tell you that. It could easily be coincidence that you were right, especially when you are considering one isolated move. If you used the method for several years and had a statistically significant number of predictions to analyze, you could determine with some degree of certainty whether or not your method worked.

I would recommend that you pick up a book about statistical analysis. Try to find something by Thorpe. The Mathematics of Gambling is a good one. I'm not saying this to be mean or insulting. It's not a natural way to think, so if you haven't studied it you won't know how to do it. I actually think this stuff and rigorous logic training would benefit people more than anything else when it comes to trading.

Balflear Jun 9, 2007 11:06am | Post# 28

Sure. On page 2-10 he says, "If you want a little more daily detail......or you can use the high and the low for the entire day and plot them in the order they occurred (this last approach is the best)".

The grey vertical lines are day separators. I've also removed some points to clean up the chart.

Thanks.
Thanks for your reply.

The method you used on h4 for a daily neowave chart looks ok, but there is no equal distant between time slot and the price since sometime you plotted the high and low in the same time slot. (refer figure 2-6 and 2-7)

Some comparison I made on GBPUSD daily chart.

Your method:
http://img368.imageshack.us/img368/5...wavegu1in4.gif

Excel:
http://img368.imageshack.us/img368/6...owavegutv4.jpg

I dont know if this affect the analysis or not, but i prefer on the excel chart. Heck, i read on other forum that by using a bar chart is also can be good.

Here some qoute from Neely on his site:
Question: In creating a wave chart, how do you decide to plot the high or low first? Answer: To produce good wave counts, wave charts are essential. A wave chart is created by plotting two price points per period (i.e., Daily, Weekly, Hourly, 5-minute, etc.) in the order they occurred during the period. Unfortunately, I have never known of a data service that produces proper wave charts, so the process must be done manually.

To determine whether the high or low came first, create a chart composed of bars 1/40th the size of the time frame you plan to plot. For a Daily plot of the cash S&P, which is open 6.5 hours each day, 1/40th of that time is approximately 10 minutes (if your market trades 24-hours a day, 1/40th of the day is approximately 30 minutes). A chart 1/40th the size of the larger time frame will make it easy to determine whether the high or the low came first on the larger time frame. Which ever came first, place that in an Excel spreadsheet (say column 1-B) and place whatever came second in column 2-B. Place the dates in column A with the same date twice before going on to the new date. Continue this vertical, sequencial placement of data until you have enough to plot a chart. A good wave chart will contain 40 or more data points. http://www.neowave.com/images/spacer.gif http://www.neowave.com/images/spacer.gif

BDtrading Feb 13, 2008 10:40am | Post# 29

Neely's book is truly fascinating. I'm a firm believer in the idea that a proper understanding of Wave Theory is the so called "near-perfect" indicator.

I'm reading the book at the moment, and thus far I can't say that any book I've completed has posed many real challenges in terms of the comprehending the material. In a sense, they've been like your typical Algebra, Geometry or First-Year College Calculus courses - read through them, do some practise, and you can apply the principles (the more you follow through on the latter, the less error-prone your application becomes). Mastering Elliot Wave I liken to Third-Year Topology - if you want to go straight into it, and obtain a sufficient level of understanding, it's going to be a long road without the adequate preparation you receive in first and second years.

Anywayyyy (sorry for my math analogy...)....

Does anyone who has read through the book have a computerised method for creating charts to be analysed. I find the process of putting my data in Excel manually very tedious. I'm also finding that the application of the Rule of Proportionality makes the task just down-right annoying.

Any ideas?

Balflear Feb 13, 2008 10:53am | Post# 30

1 Attachment(s)
Neely's book is truly fascinating. I'm a firm believer in the idea that a proper understanding of Wave Theory is the so called "near-perfect" indicator.

I'm reading the book at the moment, and thus far I can't say that any book I've completed has posed many real challenges in terms of the comprehending the material. In a sense, they've been like your typical Algebra, Geometry or First-Year College Calculus courses - read through them, do some practise, and you can apply the principles (the more you follow through on the latter, the less error-prone your application becomes). Mastering Elliot Wave I liken to Third-Year Topology - if you want to go straight into it, and obtain a sufficient level of understanding, it's going to be a long road without the adequate preparation you receive in first and second years.

Anywayyyy (sorry for my math analogy...)....

Does anyone who has read through the book have a computerised method for creating charts to be analysed. I find the process of putting my data in Excel manually very tedious. I'm also finding that the application of the Rule of Proportionality makes the task just down-right annoying.

Any ideas?
You could use the attached indicator, but i found some minor bug, possibly related to bad coding and broker timezone. (By using different broker that has diffrent timezone, the indicator plot differently.) When comparing the indicator with my own plotted excel data, the broker that start at GMT+0 almost look the same except that the indi doesn't plot the sunday candle.

I am a programmer, but haven't had the time to learn mql language yet or else i might reprogram the indi

Right now, my Neowave is on hold, Im focusing on my own simple system. After im done, might go back to learn neowave. (It does work sometime, i even can predict tomorrow high low by using the monowave)

The indi i get it from here:
http://codebase.mql4.com/en/1294
FX5_NeelyElliotWave_v1.2.mq4

BDtrading Feb 13, 2008 11:00am | Post# 31

Oh wow, thanks a lot for that (and for the rapid response!).

Have you read the book, and if so what are your thoughts on the text, as well as the so-called objective methods it details?

Balflear Feb 13, 2008 11:09am | Post# 32

Oh wow, thanks a lot for that (and for the rapid response!).

Have you read the book, and if so what are your thoughts on the text, as well as the so-called objective methods it details?
I haven't fully finish reading the book, still stuck at chapter 4 because of the intensive rules for finding the monowave. So no comment on that. If only I have a proper neowave chart, that will accelerate my learning . I even printed the excel neowave chart and do it manually until I stumble upon an Ah-ha moment and created my own system. So the neowave chart was left untouched for a long time.

BDtrading Feb 13, 2008 11:12am | Post# 33

I haven't fully finish reading the book, still stuck at chapter 4 because of the intensive rules for finding the monowave. So no comment on that. If only I have a proper neowave chart, that will accelerate my learning . I even printed the excel neowave chart and do it manually until I stumble upon an Ah-ha moment and created my own system. So the neowave chart was left untouched for a long time.
Care to share this 'Ah-ha' moment?? lol

So you don't find that the MT4 indicator works properly? How do you apply RoP to it?

Big Wave Rider Feb 13, 2008 11:13am | Post# 34

I get a headache every time I open that book. It's seems Neely is the only one who can master it. Lots of great info and is worth studying but not worth mastering unless your a math professor with alot of time on their hands.

BDtrading Feb 13, 2008 11:20am | Post# 35

I get a headache every time I open that book. It's seems Neely is the only one who can master it. Lots of great info and is worth studying but not worth mastering unless your a math professor with alot of time on their hands.
I agree, it is indeed a challenging read, but I do find it interesting - I'm no math professor but I am doing mathematics/finance at university and have a passion for the subject.

Do you recommend any other books for Wave Theory?

Balflear Feb 13, 2008 11:21am | Post# 36

Care to share this 'Ah-ha' moment?? lol

So you don't find that the MT4 indicator works properly? How do you apply RoP to it?
Sorry cant share that with you.

The indicator does work, but sometime you have to check it with your own excel neowave chart. 1 thing to note that, if you used the indicator on timeframe h1 and h4, h4 will have extra monowave which i dont know where it come from. Thats why you have to check it the the excel chart.

RoP based on my understanding and observation, its just for you to have the proper scale for you to use the RoN. Since if you change the time scale, the degree for RoN (the 45 degree) will change as well. Hope you understand what im saying, since im suck at explaining and english is not my first language. You can used the indicator, and playing with the zoom and timescale to do the RoP.

Balflear Feb 13, 2008 11:24am | Post# 37

I agree, it is indeed a challenging read, but I do find it interesting - I'm no math professor but I am doing mathematics/finance at university and have a passion for the subject.

Do you recommend any other books for Wave Theory?
Might as well just learn Nelly River Theory. He says that the river theory are much better and profitable than his neowave.

As for EW books, just go to Amazon.com and search for Elliot Wave, theres a lot of EW books you could choose and even read some user reviews/comments.

BDtrading Feb 13, 2008 11:25am | Post# 38

Sorry cant share that with you.

The indicator does work, but sometime you have to check it with your own excel neowave chart. 1 thing to note that, if you used the indicator on timeframe h1 and h4, h4 will have extra monowave which i dont know where it come from. Thats why you have to check it the the excel chart.

RoP based on my understanding and observation, its just for you to have the proper scale for you to use the RoN. Since if you change the time scale, the degree for RoN (the 45 degree) will change as well. Hope you understand what im saying, since im suck at explaining and english is not my first language. You can used the indicator, and playing with the zoom and timescale to do the RoP.
Your english is perfectly fine Yep, I understand what you're saying.

Have you read any other books on Wave Theory that you might recommend?

Big Wave Rider Feb 13, 2008 11:28am | Post# 39

Here is web page www.neowave.com, I think I would need at least a month of one on one with Neely himself (which is possible) before I can grasp all the rules.

BDtrading Feb 13, 2008 11:32am | Post# 40

Might as well just learn Nelly River Theory. He says that the river theory are much better and profitable than his neowave.

As for EW books, just go to Amazon.com and search for Elliot Wave, theres a lot of EW books you could choose and even read some user reviews/comments.
I can't find any instructional material on Neely River Theory....


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