August 12, 2017

Elliott Wave Principle 

Ralph Nelson Elliott (photo taken from Internet)

Elliott Wave Principle is also known as Elliot Wave or Elliot Wave Theory.

Elliott Wave Theory provides a comprehensive structure on where price action patterns are most likely to move. It provides a clear structure in forecast the price action movement based on the past movement.

Ralph Nelson Elliott 1871 to 1948. 

Elliott Wave Principle is a powerful forecasting tool for the financial market. Elliot Wave engineers are sometimes call Elliottician. 

Five Waves and Trend Change

Elliott Wave believes that bullish or bearish the market will move in five waves. At the end of the last wave, wave five, the price action will change in trend.  

The waves are closely related to traders emotions and psychology. 

The Five Waves are like one step forward, one step backward. These have reflected the greed and fear of the traders, the market.

Due to no two traders see the market in the same way, that is why no two Elliotticians have the same wave counts. Just like a half filled glass, one may see half empty and another may see half full. 

Elliott Wave (image taken from Internet)