Elliott Wave Counting with EG

Thank you mrforex2006.

A bit rough for me yesterday on the Cable...

The way I see it NOW, y5.50 to y5.51 was a sudden plunge probably because of the news. Now here I am again trying to find an explanation or something to base my conclusion on. This may well be what others would describe as "curve fitting". But to me, this is still a proposal to consider in future scenarios similar to this. I will try to look into past performances if this could be a valid assumption. Anyway, I just need to collect my thoughts and jot them down here. Maybe others could try to shoot this down or provide other explanations to how EW performs in these scenarios.

Back to the Cable.....

"Time factor may not be that important in this set up as Price Reversal would be."
- the sudden plunge may have hastened what I would call the "maturity level" of y5.51 and

- to factor in the time relationship to the development of y5.52 by the book would consecquently leave it (y5.52) very little time to develop

- I would then have to consider allowing y5.52 more time to develop next time.


In the future, I would like to propose here that :

1. To view/validate direction with Tech. Indicatorsand Price Action

2. To allow succeeding waves to a prior news heavily affected wave about 2-3 times more time than the standard set for time and price relationship to unfold or mature to Target Price Level.

I have come across notes stating that, "News does not deviate EW from its tracks or something to that effect. This is basically TRUE in my experience. The waves are temporarily spiked by heavy news but retraces to get back inline like a GOOD Soldier.

For people like me who try to factor into account the Time with Price when looking for direction and Target Completion Time, we have to be more cautious.

This means we also have top factor in "abnormal conditions in the market like effects of news.

If y5.4 and previous waves seemed to have progressed in a normal market condition, so that, forecasting y5.51 to y5.52 based on Price alone should have been alright even if we use y5.51 as SL level.

To which I just thought of now to consider in the future as part of my Tight SL Strategy. - that is to put SL at the end of a prior wave or what I thought was the end of the prior wave.

A second strategy would be to use the 250 pip SL Strategy.

While a third strategy would be to either let the impulse wave y5.51 run all the way to y5.55 with y5.4 as the SL level.

While a more practical strategy would be to trade only the impulse waves 1, 3 and 5. In this case where the impulse waves are going down.... I should just be trading Short trades when rallies occur.

My broker recommends using standard MACD and RSI 1 minute as entry tools. While I use CCI and Stochastics. That is just because I feel comfortable with these 2 after having used so many indicators. My broker may still be right to recommend that , but this is me..... maybe in time I just might be able to test those indicators with my EW counts.

Pouring these thoughts out is helping me sink these ideas into my brain. We definitely need technical indicators like RSI, or Stochastics or CCI to assist us in visualizing the maturity level of a particular wave.

I know many complain that these technical indicators are LAGGING. Yes they would be LAGGING if you Get Stuck in your 1hour or 4 Hour Charts. That is the reason why while we base major decisions on longer time frames to avoid whipsaws, the lower timeframes are equally important in Timing Entry and Exit Positions.

The first 3 quarters of these post was written 15 hours ago but I did not post it till now but with some additions. There maybe some inconsistencies based on the Chart and on the results of the last 10 hours.....

EG

Yeah price factor weighs more than time factor in EW, especially in forex.
For me, s/l is mostly defined by the EW rules (wave 1 can't past wave 2, wave 3 can't be shortest, wave 4 can't go into wave 1 area, etc). And for entry, I use strategy like your statement above. Anyway, in the end everything goes back to price action. EW is a price action theory right.
Just my opinion. Good luck.

Edit: "wave 1 can't past wave 2" should be "wave 2 can't pass start of wave 1" lol.

Thank you Traex.

The rules you mentioned would definitely help me reduce the 250Pip SL Strategy.

And yes.... it all boils down to Price Action.

Heck.... then why do we spend so much time studying the Challenges that EW Theory has??????

ANSWER : it is a tool that allows us to project Price. Price Action only tells us when Price Has started or is about to RETRACE (Potential DIRECTION). But it does not necessarily tell us up to what level it will retrace. EW with Fibonacci will provide us an idea to a certain extent the potential target Price Zone.

EG

No it is not a case of flip flopping.

But discovering and getting reminded to read thru the guideline of Wave Identification and counting.

y5.50 - y5.55 has taken so long to develop compared to what we initially expected it to do.
First is the revising of the y5.4 end bercause of the Time factor I missed to include.

Now y5.51 was affected by news. But what I may have over looked again is the fact that y5.4 was a little over 50% of y5.3

Based on the guidelines, it was stated that if a wave 4 is more than 50% of wave 3, there is a possibility of a wave 5 failure.

Our y5.4 is just a little over 50% of y5.3. This just alittle over the limit may be important here.

So we now have 2 possible scenarios. I was initially thinking about a possible wave 5 failure or maybe a need for a count revision. But when I saw the Brokers Count, I went back to the guideline if that was also possible to have 2 potential scenarios.......

By the way, broker's analyst uses EWA and and what I see as Andrews Pitchfork but they use the acronym DML. While I use EW and refer to a guideline.

And viola...... what do you know..... in the guide I see that notation that of wave 4 is morte than 50% of wave 3 then there is a possibility that we we have a wave 5 failure.

if that is the case, then it is possible that we may never go beyond end of y5.3. This is one scenario.

But we can still maintain the first scenario that we still see y5.5 developing by still diving lower than y5.3

m1 m5 and m15 are the only Time Frames where I see Cable coming down. But m30 and m60 seem to be at the crossroads where they can go any which way. H4 seems to exhibit cable is going Up while the Daily shows a coming down.

Overall, this would look like Cable is still meant to continue it s move down.

EG

I see a Bearish Harami on the H4

While we have a Three Outside Down Pattern on the H1 and that first candle after the harami was a Bearish Engulfing Candlestick.

Hi EG,

Thank you for sharing your experties in Eliot.

I am using Metatrader, do you know a good EW indicator?
If not, why don't you make the indicator and sell it?
You can also make a pdf easy explanation on EW.

I have a pdf that explains about EW but as you know , how to implement it is not easy. I believe you have the skill and know how to explain it. Of course it is not a perfect one. My friend use an indicator for Trade Station, it is quite good.

Eddy

How I wish it was that easy Eddy.

I too use MT4 and have been on the look out for a good EW indicator. But I still have not found one.

For now, I can't learn programming on my own. It would seem that easy to come up with an indicator based on a long list of rules. But alas I can't bring myself to study programming yet. All I can do is just modify a few things in an existing custom indicator like changing colors and adjusting time and position of a display. Other than that, everything is a blur.

Besides, my EW counting is still amateurish. First I must learn and Master EW before I can even program something based on this. There are quite a number of softwares available for EW Counting. BUt I have not purchased any yet. There are blogs and even free services that provide EW Counting based on these softwares. But even forecasts shared by people for free based on these softwares still is not perfect. I would prefer to learn the principles behind what I base my decisions on rather than basically just let a software tell me what or where I am at without really knowing how it was done.

EG

The originally thought of as y5.4 Complex turned out to be a BIGGER Wave in itself.

Because of the Price - Getting into the Wave 1 and Wave 2 Zone
and Time - As it has exceeded maximum time for a Corrective Wave 4 to Develop.

You will see on the H1 Chart Labels in Pink and in Yellow
Pink - Old and NEEDS CORRECTION
Yellow - New CORRECTED.

You will note that I should have gone back to my charts and reviewed my y5.3 In the 4H Chart, I could not see the Potential Break on what I considered initially as y5.3 wave I know I went down to 1H Chart from the 4H. But I missed that mark nwhere I could have labelled y5.3.3

I placed y53.2 where I should have placed y5.4 I think the reason why I considered the OLD y5.3 as such was because I did not really break it down to the m15 and m30 Charts. It would have shown there.

This is where I as a beginner in EW needs to sharpen up. That is to be dilligent in studying the CHARTS in Different Timeframes.

Although, the Guideline used would still have been correct up to a certain point, when things GET ROUGH and they do not follow the Guidelines, Then we need to RECONSIDER other WAVE Counts.

At this point, while I could not really trade using EW, I was busy trading using other tools. Now, we should be on our way down for the wave Z of the W - X - Y - Xx - Z movement.

Yes you may wonder what this is. I too was confused before. The broker I was following used W X Y only on some scenarios while the table of Wave Count Legends had this as a 5 wave move of W - X - Y - Xx - Z movement.

I can not explain now but will try later.

I am moving on with this EW Counts even if I encounter such situations as this because I know I can not trade with EW alone. I need to use filters or other tools to help me Trade Forex.

While above Chart seems to tell me that Cable is expected to move further down, WE MUST EXERCISE CAUTION as I am getting mixed signals from my Technical Tools.

The shorter time frames of up to m15 are showing signs of going down...... higher timeframes seem to indicate for the Cable going North.

This is based on a separate analysis and verified with my current broker who now sees the Cable moving up still.

I actually had my apprehensions early this morning before I called it a night as I normally go thru several timeframes to watch the development. I checked the EW Count of a broker whom I normally refer to (as they returned their online analysis already ) when I got back to my computer. Cable going South it seems to them is actually an option. It is still "A Possibility".

But as I said, we should validate EW Direction with other tools.

Looking at the 4H Chart... what I thought could have been a Bearish Reversal Signal was disputed by the next candle. The not so long legged doji ( red ) you see on my 4H above does not have High Reliability. I found a site which had a Nice Visual Summary of the High, Medium and Low Reliability of Candlestick Formations. And reviewing it it now shows the low reliability of that long legged doji.

I am now inclined to hold the view that Cable should be moving up North specially when it breaks the 1.9625 level then the 1.9675 moving up.

EG

I will revive this thread in the hope of learning from others too while I post my own EW Counts.

I have made several attempts at this and gave up and went back then got convinced that this is really very important and should form the backbone of my Analysis.

Since I am at this again, I might as well throw it out in the open here and hopefully some good kind soul will help me further my learning EW Theory.

Before I used to depend on others and on a Broker's EW Analysis for direction and basically focused on the lower timeframes immedietely. I would barely look at monthly and even weekly or daily. Now I have realized it was a disastrous mistake.

I have been following one broker's EW Analysis since last year. But since last month, when I started looking at the blank charts and labelling them on my own, I found that there were discrepancies with my own count compared to the Broker's count.

But since later part of June last month, many including the Broker were expecting Cable to Fall and have been warning of the impending break of the trendline on the Daily Chart. It was broken though, yet Cable resumed its climb.

Based on my amateurish count, I still see cable going up.

I will present the charts below to show how I arrived at this count. If you want to criticize my counts, that is ok. I welcome being corrected if indeed I made a mistake.

You will also notice that I am implementing a different way of labelling the waves. I have used a serialized system of labelling the waves to give me my bearings in terms of various wave degrees that have passed and waves expected to attain next. This was another of my mistakes before. I was basically concerned of the short term wave counts.

I have started my counts on the monthly. But I have not completed the counts up to the Daily and the 4h TF yet. However, looking at the 1 hour chart, I believe we are in an impulse wave right now which I will label first as an arbitrary Wave 5.

In this Big Wave 5, you will see in my charts that I have counted up to W5.4 already. That is we have already finished wave 4 of this bigger Wave 5.

I believe we are currently on Wave 5 of the bigger Wave 5.

So .... here goes my 1st Chart.

EG

Close up of 1h GBPUSD Chart.

By the way, I have finally managed to find the problem why I could not post charts before. That was one of the reasons too why I cold not pursue the discussion in this thread before because I could not post my charts. And it was difficult to solicit other traders' opinion if I could not post my charts.

This is going down to the 15m chart now.

Then we go down to the 5m Chart.

This last chart in this series will show the Wave 5.5.3 targets at 100% W5.5.1 161.8% W5.5.1 and 261.8% W5.5.1

If I am wrong, then I will try again and correct my EW Count.

Sorry about the editing of the Charts. I was hoping to post the Higher timeframe chart prior to the other chart and found I could not do it the way I wanted to.

EG

Current 4H chart will show that I have confirmed from my Monthly and weekly and Daily charts that Cable is in a Wave 5 but in a Bigger Wave 3 inside a Z wave of a Monthly WaveY in a much Bigger Wave C.

Sorry if you got lost there. But hopefully the serialized Count I used as label would help you understand where I think we are at right now.

I was wondering what happened to my earlier posts on this thread.

I posted several charts to record my current interpretation of the Elliott Wave Count in GBPUSD yesterday.

Now I do not see them anymore.

I did not want to start a new thread with the same theme . I know I made mistakes before in my counting. I am just trying to get back in the line now.

EG

Sorry Merlin.

I do not know what is wrong here. Maybe my laptop is going crazy. I could not find this thread earlier when I did a search for all my posts and when I did find it by going thru the discussion threads again... I found it but saw that the posts I made yesterday with the charts were missing. After I write to you above... and pressed submit... the charts showed up again with the missing charts.

Below m15 chart would put me in a position which based on my count woul be the start of the small wave 5.

Targeting
100% W1 - 2.0406
161.8% W1 - 2.0435
261.8% W1 - 2.0483

Note that this is only small wave 5 in a a bigger Wave 5.5.3..... by then we expect a major retrace for the Wave 5.5.4

Exited my Live Long at 2.0393 on MT4 but 2.0383 on my broker due to Forward trading nature

EG

If this small wave 5 plays out.....

you will notice to % at the upper middle portion of the chart. 100% and 161.8%. These refer to the length of 5.5.1 and we are currently in (small w5) of 5.5.3

Those percentages are are my targets for the end of 5.5.3..... But it looks like it will most likely reach the 261.8% of 5.5.1 for our end of 5.5.3 which is at 2.0435 or higher.

EG

Update:
1. @2.0351, W4 has overlapped into W1 by 20% of wave 2. I think allowed for complex wave structures.
2. Stats:
x = 78.6% of w
y = 90% of w
xx = 61.8% of y
z = 58% of w and 78.6% of y