Dislikednice. i do not believe and do not use wave theory. it is very interesting, no question, but it is just one of the thousand theories around. trading waves does not make sense because it only tries to explain the force or psychology behind the moves which already happened. but you can not know exactly the next move. what wave it is going to be? maybe it was just retracement or bounce? you will know it after it happens. but before that you take a position. so you anticipate. you will hope that it will be that wave you are expecting. and...Ignored
As are many, you are not entirely correct in your assumptions. Yes, wave theory is very much open to interpretation. It's very subjective. And when a possible wave is deemed to be identified there must always be an alternative. That's what most people do not do. They simply throw out an idea and presume it to be correct.
There is a "science" if I can use that term loosely around wave trading that DOES offer viable stop targets for waves, but yes, they may not be correct. However wave trading is one of few trading methods that can offer you a direction and POSSIBLE extension targets, and in so doing may offer you an "edge". The various major component legs of a wave usually have a fibonacci relationship to each other, but you still never know whether that will be a 1.6, 2.6. 3.6 etc multiple. Non-impulsive waves (retracements) have set rules or patterns (in general). For example, yesterday I suggested a stop on this part of the move at 132.3 or so. Purely on wave length proportions. After that, though, I also found it coincided with certain TLs and channel resistance. But the wave proportions were the first tool I used. And, yes, this move may yet continue after a reasonable move down, but we won't know for a while.
You still have to couple waves with all the other tools. Used on its own, it can be a total and complete waste of space. It's just another tool - after you've bothered to learn it properly - which (a) takes years and (b) is usually thrown around and used incorrectly by heaps of people on forums such as this (ie FF).
Anyway, I thought my anecdote pretty much reflected the general "theory" behind human psychology in markets. Hope you enjoyed it. Best wishes