Elliott Wave Principle and Examples

This lens contains preferred wave counts of markets and an introduction to Elliott Wave Principle, an analysis technique that is very valuable for trading stocks, bonds, forex, and commodity markets. Practical applications can be found in short and intermediate term analyses of markets here.

ELLIOTT WAVE EXAMPLES

I'm putting the examples at the top because they will be accessed more frequently.

S&P 500 INDEX

DISCUSSION

Lensmaster

annemarie755 wrote

in reply to Michael087 a few months

Posted July 11, 2009

Lensmaster

Michael087 wrote

in reply to AB1111 How long do you think?

Posted June 18, 2009

Lensmaster

AB1111 wrote

in reply to JSmith0 Yep, I think it will be the high for a while.

Posted May 20, 2009

Lensmaster

JSmith0 wrote

We're approaching top of 4. Important resistance.

Posted April 30, 2009

Lensmaster

RandaC wrote

Elliott wave counts appear to be fairly clear.

Posted April 23, 2009

EURO

DISCUSSION

Lensmaster

annemarie755 wrote

in reply to Michael087 probably

Posted July 11, 2009

Lensmaster

Michael087 wrote

Euro in wave 4 now?

Posted June 18, 2009

Lensmaster

VCu wrote

The US $ is in the trash.

Posted June 02, 2009

HUI Jan 2009

DISCUSSION

Lensmaster

annemarie755 wrote

in reply to Michael087 agree

Posted July 11, 2009

Lensmaster

Michael087 wrote

in reply to JSmith0 Don't you mean wave (B) rather than B?

Posted June 18, 2009

Lensmaster

AB1111 wrote

in reply to JSmith0 I think it's over now.

Posted May 20, 2009

Lensmaster

JSmith0 wrote

in reply to RandaC I think B isn't over yet.

Posted April 30, 2009

Lensmaster

RandaC wrote

in reply to djohnson1 I believe it's in C now.

Posted April 23, 2009

SOYBEANS

DISCUSSION

Lensmaster

annemarie755 wrote

in reply to Michael087 now it is

Posted July 11, 2009

Lensmaster

annemarie755 wrote

in reply to Michael087 now it is

Posted July 11, 2009

Lensmaster

Michael087 wrote

Is C over?

Posted June 18, 2009

Lensmaster

AB1111 wrote

in reply to JSmith0 Couldn't it be 123 rather than ABC?

Posted May 20, 2009

Lensmaster

JSmith0 wrote

in reply to RandaC I think beans started wave 5.

Posted April 30, 2009

Elliott Wave Principle Simplified

In the 1920s, Ralph Nelson Elliott observed consistent wave patterns in freely traded markets. He found that a trend can be broken down into 5 swings (1 through 5 below), whereas a correction can be broken down into 3 swings (A through C below). The diagram below shows the waves in an uptrend, but the same wave counts can be used in a downtrend.

Wave 1 is met with sketicism. Wave 2 shows the skeptics in action; the retracement may be very deep. Wave 3 shows broad participation; it is the point of recognition that the new trend has been established. This wave is generally the largest, but never the smallest. Wave 4 represents profit-taking. Wave 5 represents the latecomers entering the trend as it is about to end. Wave A is the first wave of the correction after the main trend ended. Wave B represents participants who do not believe that the previous trend had ended. Wave C has broad participation; it is a point of recognition that the previous trend had already ended.

Fractal Nature of Waves

Waves 1, 3, 5, A, and C are in the direction of the bigger trend in the above diagram; they can be broken down into 5 smaller waves. Wave 2, 4, and B are corrections to the bigger trend in the above diagram; they can be broken down into 3 smaller waves or a more complex combination of correction patterns.