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Anyone use Elliott Wave ?
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Anyone use Elliott Wave ?

  #21 (permalink)
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smb2222 View Post
Cpuz,
Looks like the alternate count played out. It was tricky reading the waves on this one, but I've found that being patient and waiting to see things clearer is the best strategy. I know it sounds like it's easy. It's not but as an example even though the dow and s&p went up today and broke the last lower high it told me that most likely the alternate count was in play-BUT- it was already a possible wave 3 that was already extended so I didn't trade at all today-now i'm just going to wait for a wave 2 pull back and then trade the ride to new highs. Ofcourse this may be wrong but I've found EW very helpful in looking for direction. Let me know if you feel the same way

Attached is how I saw the ES on that morning as a contracting impulse wave.
I would not have stepped in front of a 5th wave failure ending diagonal in this ES. That's an ugly situation IMO.
The YM was just as ugly as the ES.
The NQ, however, completed an absolutely beautiful perfectly neutral and symmetric text book impulse down to the tick.

The aspect that always grabs me is the logical fractal sequencing and process of elimination made possible by EW and how it combines with the Fib ratio math. When the puzzle fits together it's possible to think 2 and 3 swings and targets ahead. But it can really be frustrating when the pattern doesn't play out on cue.
When I saw the ES had respected 2043 in the morning, it was elimination that the next leg down would be the last, not 2 more legs down.
And it should have been an impulse or ending diagonal in a 61, 100, or 1618 relationship to the wave 1. It turned out to be an ugly and IMO untradeable 61.8%, but I guess that's why they made more than one US equity index.

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  #22 (permalink)
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Overlooked NQ


cpuz View Post
Attached is how I saw the ES on that morning as a contracting impulse wave.
I would not have stepped in front of a 5th wave failure ending diagonal in this ES. That's an ugly situation IMO.
The YM was just as ugly as the ES.
The NQ, however, completed an absolutely beautiful perfectly neutral and symmetric text book impulse down to the tick.

The aspect that always grabs me is the logical fractal sequencing and process of elimination made possible by EW and how it combines with the Fib ratio math. When the puzzle fits together it's possible to think 2 and 3 swings and targets ahead. But it can really be frustrating when the pattern doesn't play out on cue.
When I saw the ES had respected 2043 in the morning, it was elimination that the next leg down would be the last, not 2 more legs down.
And it should have been an impulse or ending diagonal in a 61, 100, or 1618 relationship to the wave 1. It turned out to be an ugly and IMO untradeable 61.8%, but I guess that's why they made more than one US equity index.

Cpuz,

What a great lesson. I totally overlooked the NQ. I think it's because the last time I looked at it I couldn't get a read on it, but this is a great lesson to look at all markets because these setups really present themselves clearly if you have patience. That was textbook. Thank you for posting the charts. I've looked forever trying to find others that trade elliott wave. Can't believe I missed this forum for so long.

Thanks a million for sharing your thoughts

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  #23 (permalink)
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smb2222 View Post
Cpuz,

What a great lesson. I totally overlooked the NQ. I think it's because the last time I looked at it I couldn't get a read on it, but this is a great lesson to look at all markets because these setups really present themselves clearly if you have patience. That was textbook. Thank you for posting the charts. I've looked forever trying to find others that trade elliott wave. Can't believe I missed this forum for so long.

Thanks a million for sharing your thoughts

Not so much a lesson, but more just how I saw it. I don't think most EW analysts wouldn't count 2 consecutive 5th wave failures.
I too am always curious to see how other people see and interpret things EW style - so if anyone wants to share, we might all pick up on a new trick. Its great to see where someone else connects the dots, reasons it out, or has stepped off track.

Maybe there's an integral, forgotten, or useful concept that is flying over my head. If I can see what someone else is doing, maybe I can dig deeper or ask them to show me a new trick.

I do prefer the NQ and YM personally over the ES. The 6C, 6B, GC and CL have good data definition also.

What is your personal count and forecast for the mid-term and long-term US equities rally or decline?
What are you using to come to your conclusions?

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Long Term Wave Count


cpuz View Post
Not so much a lesson, but more just how I saw it. I don't think most EW analysts wouldn't count 2 consecutive 5th wave failures.
I too am always curious to see how other people see and interpret things EW style - so if anyone wants to share, we might all pick up on a new trick. Its great to see where someone else connects the dots, reasons it out, or has stepped off track.

Maybe there's an integral, forgotten, or useful concept that is flying over my head. If I can see what someone else is doing, maybe I can dig deeper or ask them to show me a new trick.

I do prefer the NQ and YM personally over the ES. The 6C, 6B, GC and CL have good data definition also.

What is your personal count and forecast for the mid-term and long-term US equities rally or decline?
What are you using to come to your conclusions?

Cpuz,
I'll take your preference into consideration. I don't look at the NQ as much as I do the ES and Euro/USD. I posted my latest trade on this particular index. The definition is sometimes all over the place on the Euro but whenever I see a clear five wave down, I usually do well with these. I knew it had a high probability to be either a wave 4 or larger wave 2 bounce. I also took profits at the nearest most likely fib retrace which lessens the risk in my mind. Of course I trade as the waves progress but I find these set ups more entising. I always try to find the least risk. I personally would risk a little more on these set ups. The profit example I showed was just using 1 contract. I don't revenge trade so if it didn't go my way I would go back to my normal risk perameters.

I also posted my long term count on the ES. Well semi long term. This is as far back as I usually go because if it breaks above or below these larger points it gives me a pretty good idea of what the long term wave count is.

I don't use too many indicators when I trade except for volume, fib levels and DOM action which I'm just barely learning about, so I'm very green in this area. I've gotten better at noticing when large orders are swallowed up by pending sell or buy orders which helps me determine if the current price action is strong or weak. I'm looking into jigsaw for a more in depth look at this. It looks like it would be a good addition especially when trading elliott wave. It could help cut losses shorter and let profits run depending on the wave count. Do you use or know anyone that had used jigsaw?

My long term view is that we are running on fumes. I've noticed that investor sentiment is pretty strong but the options market has shown that everyone is paying higher premiums on the downside than a few years back. This to me tells us that there is still fear in the air and that a lot of smart traders are buying insurance and paying for it. I don't trade options but i like to follow what people are doing in this arena because it gives me another side into market sentiment. This last wave 5 seems to me like its struggling to get up where it is. If you watch price action for as long as I do, you tend to see the difference than just 1 or 2 years agoi when it was up at these levels.

China to me is the elephant in the room. I tend to think that they are in big big trouble. But the downturn won't be without rallies and assurance from the government and the bank of china that they will do anything and everything they can to stem the tide. Did you see that 60 minutes segment in i think 2014 that showed dozens of empty cities that were ghost towns? This made my jaw drop and showed everyone what a bubble it is over there. But they have other ways of hiding the true scary economic picture since they are a communist country, so the government can manipulate data till the cows come home. I don't think we are really seeing how bad it is over there.

The other elephant to me is Iran and Russia. Just the other day russian fighter jets flew as close as 30 feet yes 30 feet (i had to make sure i read that right) from one of our navy gun ships. In my opinion Russia is bleeding from many wounds with oil at this level. Without getting into a long political conversation, I think Putin is trying to get us into a fight or small conflict that helps raise the price of oil. So I think this could cause some ripples in the market.

The third elephant is Europe. I think they are in very big trouble as well. And I think the migrant crisis is putting them into a pracarious position. The banks from what I've read are not looking so good as well.

I don't follow these events day to day, I just watch the waves. But I tend to think we are very very overextended.

Let me know what your thoughts are

Attached Thumbnails
Anyone use Elliott Wave ?-eur-trade-example-cpuz.jpg   Anyone use Elliott Wave ?-long-term-count-futures-io.png  

Last edited by smb2222; April 16th, 2016 at 12:46 AM. Reason: Forgot to explain how many contracts
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Thank you


JonnyBoy View Post
I totally agree. I think EW has a use, but we would be naive to think this current market has free price discovery. It doesn’t thanks to the continued manipulation by the Fed in this current bear market rally.

EW technicians are having a very difficult time right now especially in this relentless rally. One in particular whom I have great respect for is losing some credibility and has had to admit partial defeat. I would ignore anything Prechter and Co. say period. He has been market bearish for YEARS and if anybody used their service to trade they would be homeless. The number of times he has called a top since 2010 is laughable but he keeps on calling it and moving his count to suit.

I do not doubt we are in a bear market. We may even get a new ATH before the crash and yes I see the S&P at 1,100 in the next 18 months but EW needs so much time to pass before a count can be labelled it only gives you the approximate location of the ball park. To get to the ball park and find your seat is all down to you.

Johnny,

thanks for sharing your feedback on the subject. If you don't mind me asking what methodology had served you well and who did you learn from. I have an open mind and love to hear about others successes

All the best
Shawn

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  #26 (permalink)
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US count

Shawn,

That's a nice bottom pick in the Euro. Nice find.
Your charts are very simple I like it. I wish I could do the same. I added in the oscillators a while back and look for supp/resist in them to to help me improve probability into the price zones I figure out.

For the Daily US Equities I like to watch Europe also as their wave structure is very clear IMO. I don't get Toronto TSX index data, but I would love to as I think their price structure has potential to be cleaner.

Weekly horizon, I am more bullish than most other EW'ers. My SPY is attached.
The bearish corrections have made perfect throwbacks to my calculations at each interval, so they've done no technical violations to what I calculate valid proportions to be. A few have been scary steep with crazy daily volatility, but luckily they stopped on a dime in a perfect 5 wave C legs with a bit of throw-under on intraday spikes.

I calculate the Prechter Point to be the move in Oct 2013. Proportions have mathematically contracted since then. So things are tightening up as the weekly candles get shorter and most everyone will agree that we are are on the back half of this 2009 rally.
I still think we have this current Daily and 1 more leg up. I'm looking at 2139 to top this current Daily rally wave (3) high which is also right at the 2015 high. Proportions are beautiful so far. Or as high as 2213 on an unexpected expansion, which is improbable because it implies a Daily 50% proportional expansion.

Wave (4) down may get steep and unnerving back to 1735 as all the wave 4's cluster in contraction. Maybe OPEC and Russia do something crazy in a few weeks?
So maybe 2213 for the wave (5) highs or as high as 2464 if a ridiculous wave 5 of (5) extension happens.

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Current Wave Count


cpuz View Post
Shawn,

That's a nice bottom pick in the Euro. Nice find.
Your charts are very simple I like it. I wish I could do the same. I added in the oscillators a while back and look for supp/resist in them to to help me improve probability into the price zones I figure out.

For the Daily US Equities I like to watch Europe also as their wave structure is very clear IMO. I don't get Toronto TSX index data, but I would love to as I think their price structure has potential to be cleaner.

Weekly horizon, I am more bullish than most other EW'ers. My SPY is attached.
The bearish corrections have made perfect throwbacks to my calculations at each interval, so they've done no technical violations to what I calculate valid proportions to be. A few have been scary steep with crazy daily volatility, but luckily they stopped on a dime in a perfect 5 wave C legs with a bit of throw-under on intraday spikes.

I calculate the Prechter Point to be the move in Oct 2013. Proportions have mathematically contracted since then. So things are tightening up as the weekly candles get shorter and most everyone will agree that we are are on the back half of this 2009 rally.
I still think we have this current Daily and 1 more leg up. I'm looking at 2139 to top this current Daily rally wave (3) high which is also right at the 2015 high. Proportions are beautiful so far. Or as high as 2213 on an unexpected expansion, which is improbable because it implies a Daily 50% proportional expansion.

Wave (4) down may get steep and unnerving back to 1735 as all the wave 4's cluster in contraction. Maybe OPEC and Russia do something crazy in a few weeks?
So maybe 2213 for the wave (5) highs or as high as 2464 if a ridiculous wave 5 of (5) extension happens.

Cpuz,
Thanks for showing me your current count. I like seeing other counts because it helps give me ideas and may even sway my current projections as well. It's hard for me to determine weather we are going to go higher from here or not. It would have been a good scalp opportunity after a five wave up but I don't do as well on these because the fifth waves like you said can extend. I've seen a lot of extended five's this last year. Don't know the significance of this, (trader psycology, PPT) I would like to hear your thoughts on this.

The euro did a textbook 68.2 abc wave 2 bounce (atleast for now) so I'm looking for it to continue down unless it somehow pulls a 78.6 or 74 out of its ass. It's certainly possible. I've been conversing with Matt over at Optimus and I'm so glad he posted his experience with other clients liking Motive Wave. Todd Gordon at Trading Analysis has some great YouTube videos on it and he thinks it's one of the best platforms out there, specifically EW traders. Check out this video. I'm definately interested in using this software. It gives auto counts but allow you to manually reconfigure them if you don't agree with its current wave count. This saves countless hours marking the charts with wave counts. It looks quite good

BTW, Thanks for eluding to NQ's common clean wave counts. This last wave 3 up was a really good trading opp

Let me know what you think

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Last edited by smb2222; April 20th, 2016 at 01:31 AM. Reason: Want to add chart-wanted to add last comment
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smb,
IMO, the Euro last rally was a B wave of some degree. And I'm expecting a C leg down to continue tonight.

I'm not familiar with those analysis platforms. I'll have to take a look at that video. I used MTPredictor for a long while. Their trading room is no extra cost and helped me learn, but now I'm only using it for position sizing. I'm hoping one of the indicator vendors comes out with a better position sizing tool soon - I've got my requests in.

I personally gave up on the software analysis approach and went back to the books and theory. I like understanding and applying the fractal math theory, measurement and projection techniques personally. I've found that if I don't have an expectation of what is valid, related, proportional, balanced, etc, then I can't enter trades or hold them with any confidence. I ended up going down the route of learning to read price character and the nuances within the data swings. And confirming and balancing them with the oscillator levels and patterns. It does take a lot more effort and time though, as you noted. But I had an additional requirement to understand what I was doing on long term Equities charts as well, where I didn't have the luxury of waiting for perfect patterns to show up. The pattern matching approaches of software weren't helping me in that effort.

There have certainly been a number of extending 5th waves and ending diags IMO in the US equities since 2009. I don't think I can guess about the psychology since there's so much confusing News about robo investing, share buybacks, Americans not participating in the rally, stimulus, China, Oil, etc. My opinion is that the swings off the 2009 and 2011 lows were so strong and the overall pool of money going into the US markets is contracting as credit and ultimately currency contracts from China, Euro and the Dollar. I think this is seen in the contracting proportions past Oct 2013. Markets have had to stretch out time instead of keeping equal price proportions and that's created the long time duration 5th waves to at least keep a .618 proportion in the back half of the overall long term impulse wave.

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Anyone use Elliott Wave ?-2015-02-24_13-42-40-eurusd-30m.jpg  

Last edited by cpuz; April 21st, 2016 at 11:45 AM.
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  #29 (permalink)
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Counting waves is something I use but it has to be in relationship with Fib extensions or retracements. That being said I also use other tools to help me decide if we are near the end of a potential reversal area.

In a perfect world of Mr Elliott all the waves would be there but I have realized over the years that this is not always the case you quite often have failures or 1 more leg can be printed to test out the supply and demand specially if the Fib target has not been reached.

The biggest difficulty is also to find the right time frame and again it does not exist you have to look on multiple time frames on ETH and RTH. I often see certain patterns that I consider very low risk trades today we had 2 that I noticed on the YM on the 10 min we had a nice relationship wave 1 = wave 5 and on 1 min we had a 5 wave advance from the 10 min low followed by a nice abc down with 5 waves in leg C. (RTH)

I forgot to say that EW is easier to apply on intraday charts as you can quickly know if your count is valid or not while long term counts can be very costly if you are wrong. Also I do not trade using only what you see on these charts I cleaned them so you could better see the count.

Larry

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Interesting read - thanks guys.

-Jimmy
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