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Elliot Waves musings

  • #1
  • First Post: Jun 17, 2008 7:52am Jun 17, 2008 7:52am
These are my (beginner) views regarding Elliot Waves on a couple of pairs that I watch.

The way I use EW is not as complete trading system but rather as the part of the trading system that helps me identify the position in the trend and possibly gauge the end of a move, impulsive or corrective.
Entries are completely different things. I use bar patterns, range breakouts and even simple bar reversals as long as the reversal takes place at a valid EW level.

I'm a fan of simple EW (and simple trading rules for that matter) and I'm not looking to count every move. If I can't easily find a count then I conclude that it's not there and move on.

If you post please keep it on topic, EW and related. I'm especially looking forward for contributions of accomplished EW users as I'm a (relative) beginner.
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  • #2
  • Jun 17, 2008 8:01am Jun 17, 2008 8:01am
I always start from the Daily view then go down on H4 where I look for an entry.

I posted this in another thread but will post it here too, will use this thread from now on.

I think that we are still in the corrective downtrend, wave C.
I have two targets in price for the C wave completion:
1) 1.5100 (A=C)
2) 1.4650 (A strong confluence)

Currently I put more weight on the second target, thinking that wave C will unfold in 5 waves.

Also in regards with time I think the correction is still too early to finish. I think we need at least another month before having a chance to finish C. One key date being July 27.
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  • #3
  • Jun 17, 2008 9:05am Jun 17, 2008 9:05am
The bullish moves of the last 12 months were clearly 3 wave moves. The last c wave of the bigger C was a 5 wave impulse wedge that completed the c:C.

Considering that what we had so for were 3 wave moves the only thing I can think of is that we may soon have big impulse moves down.
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  • #4
  • Jun 17, 2008 5:53pm Jun 17, 2008 5:53pm
Very interesting soso, I studied EW some time ago but always had the wave count messed up. isn't it quite descretionary? Your charts looke quite impressive, hope to learn more from you in the near future.
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  • #5
  • Jun 17, 2008 6:12pm Jun 17, 2008 6:12pm
Interesting. I've been working along the same line. An eye to market structure will always improve any trading system, whether it's based on indicators or price action. I don't worry too much about actual counts. I'm mainly interested in deciding the current state of the market. Ranging, Trending (impulsive) or Countertrend (corrective). This helps in determining the direction to trade. It also helps to pay attention to the Fibonacci relationships among the waves as this will reveal where take profits should be.
  • #6
  • Jun 18, 2008 1:35am Jun 18, 2008 1:35am
Quoting jattputt
Very interesting soso, I studied EW some time ago but always had the wave count messed up. isn't it quite descretionary?
That's what I thought at first too when looking at EW thread and seeing that every person had a different count. But having a different count is not really a problem for the trader, what matters is your count. Think your system versus their system, it's the same thing.
Truth is sometimes I am not sure about the position in the trend and a 2 can be a B or viceversa. This still doesn't matter as long as I know where the market should move according to my (simple) EW guideliness and what would invalidate a count. Actually EW is all about validating/invalidating the pattern, it either is or is not at all. Pretty not discretionary in my eyes.

The power that I have from EW is that it helps me to stay in the moves because I know that if the pattern is right then the move still has a lot of steam to go and instead to get out I scale into the position.

But take note that I am still in the learning stages of EW.
Trading = a mirror to your human flaws. Fix them or be fixed.
  • #7
  • Jun 18, 2008 1:38am Jun 18, 2008 1:38am
Quoting taxgeek
Interesting. I've been working along the same line. An eye to market structure will always improve any trading system, whether it's based on indicators or price action. I don't worry too much about actual counts. I'm mainly interested in deciding the current state of the market. Ranging, Trending (impulsive) or Countertrend (corrective). This helps in determining the direction to trade. It also helps to pay attention to the Fibonacci relationships among the waves as this will reveal where take profits should be.
Yes taxgeek, these are the main lines that I also follow. Good luck!
Trading = a mirror to your human flaws. Fix them or be fixed.
  • #8
  • Jun 18, 2008 2:41am Jun 18, 2008 2:41am
Soso,

Have you read Robert Miner's book? I think I already asked you if you're the same guy from MT? Anyway, his book is very good and he uses a simplified version of EW as well. It's worth a read if you can pick it up cheap or free.
  • #9
  • Jun 18, 2008 2:51am Jun 18, 2008 2:51am
Quoting Dopey
Soso,

Have you read Robert Miner's book? I think I already asked you if you're the same guy from MT? Anyway, his book is very good and he uses a simplified version of EW as well. It's worth a read if you can pick it up cheap or free.
I actually read it this weekend, well most of it. And I think is one of the best on EW out of what I read until now.
And I don't really post on any MT forum, maybe a couple of posts in the past but nothing else.
Trading = a mirror to your human flaws. Fix them or be fixed.
  • #10
  • Jun 18, 2008 3:02am Jun 18, 2008 3:02am
I use H4 charts to enter trades. Daily EW trend is paramount, I never fade it and I call it the major trend while on H4 I call it minor trend. Sometimes I have good counts on Daily but no counts on H4 but it's still ok for entry.

Now I think we are about to complete the B move up, at least we have a struggling up move against a high momentum down move. This suggests reversal is due. The question is did we put the top yet?

I have 2 scenarios:
1) We have the top and B wave is complete. I have a sell order just below b, at 0.9387 for this.
2) Another probable top is at 1/2 of the down move where we also have a confluence of projections. If we get there and not pass through it I'll short the first bar that moves lower.

Later edit: On chart it says Daily but is H4.
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  • #11
  • Jun 18, 2008 3:04pm Jun 18, 2008 3:04pm
A very clean count on this pair on Daily. Every impulse move down can be easily broken in impulse moves. Now we are in the ABC correction that follows the big move down.

Here's a rough roadmap of what I think will follow. Currently we are Wave (B) of the correction, it looks like a correctiive move as it is creeping. The first target for (B) is 1.5850 although it could go lower. Then a fast (C) move up shoud follow before resuming the down trend.

We could also have the correction completed already at c but I doubt it since the current move down doesn't look like an impulsive one.
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  • #12
  • Jun 19, 2008 3:59am Jun 19, 2008 3:59am
Zoom in on H4.

I think there is a chance of the downtrend resuming to complete the Daily C wave down.

I'm short as of 1.5550 and if I'm right we should see at least 1.5100 as in the previous Daily analysis. We could go lower if the big C wave will unfold in 5 waves.
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  • #13
  • Jun 22, 2008 3:59pm Jun 22, 2008 3:59pm
Quoting soso
Zoom in on H4.

I think there is a chance of the downtrend resuming to complete the Daily C wave down.

I'm short as of 1.5550 and if I'm right we should see at least 1.5100 as in the previous Daily analysis. We could go lower if the big C wave will unfold in 5 waves.
Stopped out, the new wave layout being the following:

The biggest change is on 4H charts where I think it will unfold in corrective waves instead of impulse wave. Reasoning being that the blue A for which the most obvious count is corrective. Which means we'll have ABC instead of 12345.

As of price, Friday we hit a confluence of 1/2 of big A and 62% of current A. We had a reversal bar formed in there.

The target is still 1.5100. Curious that if the current top at 1.5650 holds then at this target green pattern will have A=C and blue pattern A=C also.

Too many things look good so I took another short at 1.5606 with stop at 1.5665. But when many things look too good watch out.
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  • #14
  • Last Post: Sep 12, 2014 3:50am Sep 12, 2014 3:50am
Hi
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