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Counting is totally subjective and after the fact. Following the basic EWT rules for an impulse wave, pick and choose HHs and LLs that make sense and are within the rules for wave count. For ABC though, all I look at is an impulse wave, if it has a five wave count is even better. For me, for example, a 100 tick move in CL is considered an impulse wave where I look for a retracement and formation of the AB leg and then project the C. The formation is most powerful when B and C are formed on or near S/R levels or fib levels.
ABC works great when confirmed with S/R levels and you don't really need to be an expert in EWT, very close to what MTPredictor does
For this one, you are talking about an ABC at the end of the wave, yes? Not the ABC after the important low, because there was no important low here, right?
In the last chart I commented on, I took that as an important low followed by ABC, where C is the start of wave 3?
Yes, it is quite possible that BC leg continues as the Wave 3, however, if you look at the expanded chart or a HTF chart, the general trend is up with at least 2 complex ABC retracements occurring prioir to the impulse leg "X."
For this, you need to enter on a confirming bar and place your stops not too far from the C to limit risk. ABC needs to be confirmed with S/R levels or whatever other tools you may have.
Unless you swing trade, for day trading all you need a strong impulse wave, it can be Wave 3 or other waves, and formation of the ABC. A 5-count impulse X leg is more powerful.
You are right Mike, the idea is having a strong "Impulse" X leg (0.5 -1.0 times Average Daily Range), then look for the ABC to form. Important highs and lows can be used to project your targets or stops. This is not quite EWT, however, the more common with EWT, the more powerful.
For scalping and daytrading, you can do a full blown EWT count to find perfect ABCs (knowing that EWT is subjective and can not be perfect) but you will miss a lot of good opportunities. All you need is a strong X and the ABC.
Here is a link for a free 1-hour ( March 28, 4:00 - 5:00 PM EDT) seminar by Todd Gordon (one of the few true EWT technicians) on the A_B_C's of Elliot Wave Corrections. Todd is well respected and a frequent commentator on CNN and speaker at trading expos.
I have no relations with his company, Aspen Trading. It should be informative.
Can you help me understand the impact/importance of selecting an important low or important high, vs selecting an impulsive leg, when defining the start of a brand new wave formation? (also, what is the correct terminology for a "brand new" wave formation?)
I see you've said that an Impulse leg needs to be 50-100% of the average daily range. During the last EWT webinar, Steve never mentioned an impulsive leg (that I recall), instead focusing on an "important" low or high. I'd like to understand the significance of the difference when looking at a new formation, according to the EWT philosophy I of course have my own opinions...
"Successful trading is one long journey, not a destination" Peter Borish Former Head of Research for Paul Tudor Jones speaking on conversations with John F. Carter
I of course have my own opinions... 