opinion of the market position.None of these charts show the price relationships described in me textPrice projections will be illustrated in the Dynamic Price Analysis chapter.For now, I just want you to gel used to viewing the market from a patternperspective. Many of the charts shown here will also be used to illustratetime and price projections in the next two chapters so you will begin tosee the value of the holistic approach to market analysis.Set-ups that worked and those that didn't work are shown. Bybecoming very aware of the pattern position of each market tradersand investors soon learn to make a quick and accurate determinationif a market is in a trend or counter-trend and the market pattern thatwill signal the end of the trend or counter-trend.If a trader did nothing but learn to recognize the completion of a fivewave-impulse sequence, think what a profitable benefit that would be!What are the ramifications? When a five-wave-impulse sequence iscompleted, a counter-trend larger in time and price than any since thebeginning of the five-wave sequence should unfold.If a trader knows that most counter-trends are at least a simple ABCand only a minor rive wave counter-trend has unfolded, the trader knowsthat the odds are very high that that minor five-wave counter-Trend isprobably only wave A and the entire correction will not be complete untilwaves B and C complete. How profitable do you think this simple piece ofinformation will be?Focus on the basics. Learn to recognize the obvious and be wary of theless than obvious. Always consider what is me specific market activitythat will validate or invalidate the pattern position. What is the marketactivity that should follow the validation or invalidation signal?Remember that the objective of Dynamic Technical Analysis is toidentify low-risk/low-capital exposure trading opportunities, not to forman opinion of the position of every market, all of the time.
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Pattern and Practical Elliott Wave Analysis
Parallel Channels Often Project The End Of Wave 3 and 5The parallel channel was constructed by drawing a trendline from the Dec,3 high (beginning of the bear trend) to the wave 2 high. A parallel line wasdrawn from the wave I low. The wave 3 low was made on the parallelsupport line.Parallel channel targets for waves 3 or 5 should only be considereda confirmative target within the context of the time, price and patternanalysis. If the time, price and pattern factors are signaling a low at thesame area as the channel line, the probabilities increase for the trendchange.
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Dynamic Trader - Chapter 3
Parallel Channels Of Two Degrees Project The Wave 5 HighThe parallel channel is constructed by drawing a trendline from the waves2 and 4 lows and a parallel line from the wave 3 high. In the chart above,parallel channels were constructed for wave 5 and wave 5:5.The wave 5 and 5:5 top was made at the coincidence of both degreesof parallel channel resistance,
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Pattern and Practical Elliott Wave Analysis
It Doesn't Always Work But Still Provides Valuable InformationA parallel channel of waves 2-4 from wave 3 was constructed to project awave 5 high. The Deutsche mark shot right through the resistance channelline but soon made the final, wave 5 high.A market will usually not make an extended trend beyond a wave 4or 5 channel projection. Exceeding the waves 2-4 trendline usually signalsthe completion of the prior trend.Consider waves 4 and 5 projection channels as alert signals. Theyoften provide the targets where waves 4 or 5 terminate. They are usuallynot exceeded for long. Traders and investors should be very alert to thetime, price and pattern position of a market if the channel target isexceeded, as the market is probably "overextended" and nearing thecompletion of the whole trend sequence.
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Dynamic Trader - Chapter 3
Ideal Five-Wave Advance and ABC CorrectionThe rally and correction in gold from the March 1993 low through theSept. 1993 low is a textbook illustration of a five wave impulse and ABCcorrection. If would be nice if gold and other markets conformed so nicelyall of the time. They don't, but what is important is to recognize the setups when they do.Note how impulsive waves three and five sub-divided almost perfectlyinto five waves themselves.What should we anticipate after the conclusion of a five wave advancefollowed by an ABC collection? Another five wave advance that shouldexceed the Aug. 5, wave 5 high. The next page shows what happened.
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Pattern and Practical Elliott Wave Analysis
Advance Follows ABC Correction As AnticipatedThe gold market had not read R. N. Elliott's work. Gold did advance fromthe ABC, Sept. 13 low as anticipated but not in an impulsive, five waveadvance. The advance was a choppy, labored affair. While it made higherhighs and higher lows, the very definition of a bull trend, the patternappeared more corrective than impulsive with overlapping waves, difficultto identify sub-waves, etc.While we could label this advance in any of a number of ways, forpractical purposes the pattern does not conform to a practical wave patternthat provides decision making information to the trader. Do not force acount when none exits!The failure of an impulsive five wave advance to develop from theSept. 1993 low as anticipated, signaled the larger degree trend wasprobably not as bullish as anticipated- This turned out to be the case asgold did not exceed the Aug. 1993 high for over two years. Never-the-less,there were still many good trading opportunities during this period from ashorter term perspective.
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Dynamic Trader - Chapter 3
Elliott Wave Pattern Analysis Provides The Market Action ThatInvalidates An Anticipated OutlookGold made another textbook, five wave advance from the Nov. 22, 1995low to the Feb. 2, 1996 high. Wave five sub-divided perfectly into fivewaves. What should we anticipate following a textbook, five waveadvance? Unless it is a wave C, another five wave advance should follow acorrection.Gold declined sharply Into a low on March 7 that appeared to be awave A low. The wave B rally was an ABC correction. Once the low ofApril 19, labeled C, was exceeded, it became obvious the gold market wasnot going to comply with the anticipated Elliott wave outlook.Once a market is not conforming with a pattern that falls within therules and guidelines, do not force an Elliott wave count just for the sakeof having a count.From a trading strategy perspective, traders should be aware that afailed signal is often a signal for a sharp move in the opposite direction.Once the April 19, potential wave C low was exceeded, gold haddemonstrated its weakness and bear trend. Go with the market signals,not personal expectation. Trade the market, not the forecast.
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Pattern and Practical Elliott Wave Analysis
Wave Three Is Usually The Longest and Strongest WaveFrom the April 18, 1995 high, the mark made an almost ideal five wavedecline. Note the force of wave three wich the wide range and gap daysdown- While the earlier data is not shown, the April 18 high was madefollowing a prolonged bull market trend.The five wave decline from the April high should be considered eithera wave A in a major ABC correction or wave one of a new bear trend. Ineither case, another five wave decline would be anticipated following acorrection up from the May 18 low.The rally from the May 18 low was not an ideal ABC correction.Many Elliott wave analysis would probably put in a few X waves to makea pattern fit the market activity into the July high. No pattern count wouldprovide a predictive indication that July 19 would be the final correctivehigh. It is at this point that other analysis techniques such as the DynamicTime and Price projections are important.From a practical trading perspective, the key pattern analysis factorsprior to the July high were: 1. The five wave decline from the April 18May 18 signaled the major trend should be bearish. 2. The mark shouldcomplete a corrective high below the April 1 & high followed by at leastone more decline to a new low.From the July 19 high, the mark again declined in an almost ideal fivewave impulse pattern. Again, wave three includes the widest range andgap days. Wave five is a fifth-wave-diagonal. Remember that diagonalfifth-waves are usually followed by sharp corrections. That is an under-
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Dynamic Trader - Chapter 3
statement in this case. The mark exploded upward following thecompletion of wave five of five.Five Wave Sequences Are Usually Part of a Larger Degree TrendFrom the Aug. 2, 1995 low, cotton made an ideal five wave advance intothe Sept. 1 high. A decline followed, making a low near the wave fourlow. Corrections to five wave impulses typically terminate at or near theprior wave four extremeHow does the five wave advance into the Sept, 1 high fit into thelarger picture? It could be either a wave one of larger degree or wave A.From a trading perspective, it doesn't make any difference. In each case,another rally to new highs following the correction is anticipated, and thatis exactly what unfolded.
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Pattern and Practical Elliott Wave Analysis
You Must Be Quick To Reassess The Pattern Position If A MarketInvalidates The "Preferred Count"Copper was in a very strong bull trend from the Oct. 26, 1993 low. Wavetwo was an ABC, running correction which was very bullish. Wave fourwas an irregular ABC.It appeared that Sept, 26,1994 (labeled 5?) completed a wave five highin a text book blow-off. A very sharp and short decline unfolded from theSept. 26 high followed by a continued rally to new highs.With the continued rally to new highs, the five wave advance into theSept. 26 high is invalid and a new count must be considered. The mostlogical alternate count is an extended wave five beginning from the Aug.5, wave 4 low. Why is this the most logical alternate count? Waves onethrough four (Oct. 1993 through Aug. 1994) are a perfect fit and do notlend themselves to an alternate count. We should assume that they arecorrect.Copper advanced in five waves from the Aug. 5 low to make the finaltop Jan. 19.
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Dynamic Trader - Chapter 3
The Lesser Degree Pattern Position of a Market Will Often Signal TheLarger Degree Trend PositionIn Dec. 1989, the Nikkei made a major bull market top. At least an ABCcorrection would be expected from the Dec. '89 high. The Nikkei made athree section decline from the Dec. high into the Oct. 1990 low. Was Oct.1990 an ABC correction or wave one through three of a five wave,impulse decline? What would be the signal for each?If Oct. 1990 completed an ABC corrective low, a five wave advanceshould be made from the Oct. low. The Nikkei made a three wave advance(ABC) followed by a continued decline to new lows. This signaled thatMarch 20,1991 should be a wave four high and a wave five to new lowsshould be made. The Nikkei then declined in another text book, five wavepattern to make the wave 5 of (5) low in Aug. 1992,What was the first signal following the Oct. 1990 low that alertedtraders and investors that the rally was probably a wave four and not thebeginning of a new bullish impulse sequence? The signal is obvious fromthe chart above. The detail is shown on the next page.
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Pattern and Practical Elliott Wave Analysis
Elliott Wave "Rules" and Guidelines Will Often Signal Very QuicklyWhether A Market is In a Trend or Counter-TrendThe chart above is a close-up of the chart on the previous page of themarket activity following the Oct. 4, 1990 low in the Nikkei. The alternatewave counts are shown with a question mark. The initial weeks of the rallylooked like it could be waves one and two followed by waves one, two andthree of the larger degree wave three. What was the first signal thispotentially very bullish wave count was incorrect?Wave four should not trade into the price range of wave two. TheNikkei declined from the March 1991 high which is alternately labeledas wave 3:3 into the price range of wave 1:3. This voided the bullish wavecount and signaled that the March 1990 high was probably not wave 3:3but wave C of a completed ABC, wave four. This had major implications.Another five wave decline (wave five of larger degree) should then unfoldto new lows! This is exactly what unfolded. See the chart on the previouspage.By being aware of the pattern position of a market and the ramifications of when a pattern is voided, the trader and investor is prepared forthe early signals of the direction of the larger degree trend. Every marketdoes not always provide such a ideal wave count and alternate count setup. But when they do, traders and investors are provided with a powerfulpiece of information.How would you like to have known in June 1991 that the Nikkeishould probably continue to decline to new lows in the months ahead?
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Dynamic Trader - Chapter 3
What wave count?The S&P began a relentless bull trend from the Dec. 1994 low. Up to theFeb. 1996 high, there were no waves to count! If you followed any of thetraditional Elliott wave analysis services, you may recall any number ofwave counts that continually projected a wave five top. Prior to Feb. 1996,where could you possibly count waves four and five? Only in the illusionsof your mind. Certainly not on the chart.Why did many of the services see a five wave advance as completeprior to Feb. 1996? They made the wave count fit their forecast. If you arestrongly predisposed for a particular market forecast, you will find theevidence, however flimsy, to support that outlook.Don't trade your prophesy of the future. Trade the market. Don't seewhat isn't obviously not there, or it will be very detrimental to your wallet.
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Pattern and Practical Elliott Wave Analysis
Markets Do Not Always Play By The RulesSugar made a five wave advance into the March 1996 high that brokemost of the rules. Markets just have no respect. Each larger degree impulsewave (1, 3 and 5) sub-divided into five waves. But, in every case, the wavefours traded into the range of the wave ones for a day or two and thenimmediately continued the bull trend.Traditional Elliott wave analysts would feel forced to re-label thewaves to some sort of complex and indecipherable collection. Realworld traders will look to identity the completion of a five wave sequencein order to step out of the trade and possibly reverse the trading direction.If a market is closely fitting the structure of a wave sequence, at leastconsider it valid even if it very briefly breaks the "rules."The Dynamic Time and Price projections which will be learned in thenext two chapters will be critical to validating me probability of the wavecount.
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Dynamic Trader - Chapter 3
Do Nat Ignore The Ramification of the Completion Of MultipleDegrees of 5th WavesThis is a close-up from the previous page of the larger degree wave fivethat began from the Jan. 16, 19% low. This is a beautiful example ofminor degree sub-divisions signaling the trend reversal of larger degree.Sugar made a final lop at wave five of five of five.Look again at the chart on the previous page and note the extent of thedecline from the March 1996 high. Do you care if this five wave sequenceprecisely meets all of the Elliott wave "rules" or would you rather be prepared to recognize completion of the final, minor wave five of a long termsequence?
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Pattern and Practical Elliott Wave Analysis
Don't Force a Wave Count Where No Logical Count ExitsWhat is your idea of a wave count for this three year bull trend in bonds?This was an unmistakable bull trend, yet there is no logical Elliott waveimpulse count that was evident as the market was unfolding or is evidentafter-the-fact.However, almost all of the intermediate degree trends marked off onthe chart made very clean five wave advances and three wave declines.The chart above are weekly bare. Check your daily charts for theintermediate degree patterns to see how tradable bond swings are.
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Dynamic Trader - Chapter 3
When Handed A Gift, Take ItIt doesn't get much better than this. Beans made an almost ideal five waveadvance from the Feb. 1,1995 low into the April 11, 1995 high followedby an ABC correction into the May 9,1995 low.
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Pattern and Practical Elliot! Wave Analysis
Markets Do Sometimes Correct In A Five-Wave SequenceCorrections are supposed to be three waves or a scries of three waves,right? Somebody forgot to tell the bean traders. Beans made an ideal,five wave impulse decline which completed a collection. The beanmarket hadn't read the Elliott wave textbooks.Traders may still have taken advantage of the five wave declinefrom the short side and know to bring stops close to the market as beansentered the fifth wave down.Take advantage of what ever information the market is providing.Profits will be maximized and losses minimized.Do not try to re-label this decline to fit the "rules" of corrections. Thisis a five wave, impulse sequence, period. Now and them, a correction willbe a perfect five wave sequence. Academic Elliott wave hardheads willalways re-label a market to make it fit their perceptions of how they thinkit is supposed to be rather than move on to the present condition and thenext money-making set-up.
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Dynamic Trader - Chapter 3
Elliott Wave Analysis Applies To All Actively Traded MarketsThis is a chart of the close-only data of Fidelity's Select Precious Metalsmutual fund. Elliott wave pattern analysis applies to all actively tradedmarkets including futures, stocks, stock indexes and mutual funds.The PM fund made a five wave advance where wave five subdividedinto five waves in text book fashion.
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Pattern and Practical Elliott Wave Analysis
Form More Important Than RulesThe chart above is weekly close-only data of Fidelity's Select Bio-Techfund. The bull trend from the Nov. 1987 low to the Jan. 1992 high hadthree distinct rally sections, waves 1,3 and 5. Waves 1 and 3 definitelydidn't conform to Elliott wave impulse pattern rules or guideline, but stillwere distinct rally trends. Wave 5 (Oct. 1990 - Jan. 1992) was a text bookElliott impulse pattern, right down to the five-wave subdivision of wave 5.The ABC correction (Jan, 1992-March 1993) was also a text book pattern.The initial five wave decline into the June 1992 low is the A wave. The Bwave was an abc (correction to the correction). Note the initial, minor fivewave pattern up following the C wave low.How is this analysis put to practical used?1. As the mutual fund rallied to new highs in Jan., it appeared that it wasin a minor wave-five [hat should also complete the intermediate andmajor wave fives.2. Let the mutual fund signal if a top has been made. Exit long positionsif the mutual fund declines below Wave 4:5:5 (see the chart above).3. The mutual fund made a five wave decline into the June 1992 low.Corrections usually do not complete with five waves. The June lowshould be an A wave which should eventually be followed by anotherswing down to lower price (C wave). This is exactly what occurred.Elliott wave analysis of this mutual fund prepared investors for a majortop and provided the discipline to wait until the correction had run itscourse. While the entire form of the impulse series did not follow all of theElliott wave "rules", the pattern was an unmistakable five wave trend.
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Dynamic Trader - Chapter 3
Five's and Three'sTreads usually terminate in five wave patterns. Counter-trends usuallyterminate in three wave patterns or a series of three wave patterns (complexcorrections).Following a five wave advance. Fidelity's Balanced Fund made anABC correction. It appears another five wave advance is nearing completion as of the time the examples for this chapter are completed.Note how the advance accelerated when the wave one high wasexceeded. It appears waves 1-4 are complete and the current advance is inwave five. If this is the case, when wave five is completed, a decline greaterin time and price than any since the Aug. 2 low should unfold.
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Pattern and Practical Elliott Wave Analysis
Diagonal-Fifth-Waves In Mutual FundsElliott wave patterns are alive and well in Fidelity's Emerging Growthfund. Wave 1 clearly sub-divided into five waves. Wave 3 was almost aparabolic advance, typical of wave 3s which are usually the longest andstrongest of the three impulse waves.The wave four correction was an ABC. Note how wave C clearlysubdivided into five waves, typical of C waves.What has unfolded since the Jan. 10, 1996 wave-four low? It appearsto be a fifth-wave-diagonal. Waves 1 & 2 of 5 appear complete. What isusually the outcome of the completion of a fifth-wave-diagonal triangle?A stronger than typical counter-trend. A strong bear trend should unfoldfollowing the completion of the fifth-wave-triangle.Only marginal new highs would be expected from this point on in thismutual fund. Investors in this fund should be anticipating a major lop andhave relatively close stops. A decline below the support line should signala top is complete.
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Dynamic Trader - Chapter 3
Waves Within WavesThe ideal trade set-up is made when at least one smaller degree wavepattern signals the completion of the larger degreeIn early Jan. 1999, the yen appeared to be in the later stages of animpulse five-wave series that began at the Aug. 11 low. The subdivisionsof Wave-5 helped to pinpoint the completion of the larger degree patternshown on the daily chart.See the 60-minute chart on the following page.
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Pattern and Practical Elliott Wave Analysis
60-Minute Date: Subdivisions of Wave-5A Wave-5 should subdivide into a five-wave structure of lesserdegree.Wave-5 began from the Nov. 12 low (see the daily chart on thepreceding page) and clearly unfolded in a five-wave structure. Both Wave5 and Wave-5:5 were ''extended" or greater in price than a typical Wave-5.The price chapter will Teach you how to project the price targets for thetermination of a five-wave impulse trend.We can go to an even shorter-term time frame and see if Wave-5:5 alsosubdivided into a five-wave structure.
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Dynamic Trader - Chapter 3
15-Minute Data: Subdivisions of Wave 5:5While a wave pattern may not be an ideal structure meeting all of the ralesand guidelines, the basic form is usually clearly evident.The 15-minute data shows that Wave 5:5 from the Dec, 22 low intothe Jan, 11 high clearly unfolded in a five-wave structure. There areimmense trading ramifications to the Trader who is alert to the wavestructure of any trend or counter-trend.Once the yen has advanced above the Wave 3:5:5 high, we know thatwe should be in the lasf minor swing up (Wave 5:5:5) before thecompletion of the entire bull trend that began almost five months ago inmid-Aug. How would you like to be alert to the probability thai a majortrend is only days away from completion? If you were long, you would bevery careful to protect the unrealized profits and alert to trading strategiesto enter a short position.A trade below the Wave 4:5:5 low signals the completion of the entirebull trend since Aug.! Wave 5:5:5 is complete! The yen should then makea decline greater in time and price than any decline since the Aug. low.How did it turn out?
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Pattern and Practical Elliott Wave Analysis
Pattern Analysis Identifies The Completion of the Five-Wave TrendJust two days following the Jan. 11 high the yen declined below the Wave4:5:5 low signaling the completion of the five-wave bull trend from theAug. low. This signal came right at a time when many yen traders werevery bullish. Dynamic Traders knew that the bull trend should becomplete, at least temporarily as the yen makes a decline greater in timeand price than any decline since the Aug. low.Even in the very volatile and often choppy currency markets, patternanalysis will often clearly identify the position of a market and the trendobjectives. Short-term trades may be made off of the signals andobjectives provided by the intraday data, Intraday data is also used toidentify the trend position and completion of larger degree trends.
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Dynamic Trader - Chapter 3
Pattern Analysis Nails The Completion of a Major LowBonds made a significant low on Jan. 11. Since this example is beingincluded just a few weeks after the low, we don't know yet if this will be along term low or not The pattern position indicates it is the completion ofa major ABC correction. Regardless of whether it turns out to be a longterm low or not, the pattern analysis provided the signal for a great see-upfor a long position.
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Pattern and Practical Elliott Wave Analysis
60-Minute Data: Wave-C Sub-Divides Into Five WavesA Wave-C should subdivide into five-waves which is exactly whathappened. The 60-minute chart clearly shows the five-wave subdivisionsof Wave-C.The 15-minute chart on the following page shows the subdivisions ofWave-5:5:C.
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Dynamic Trader - Chapter 3
15-Minute Data: Wave-5:5:C Completes A Major LowWave-5:5 subdivided into a perfect five-waves itself. Once bonds haddeclined below the Wave-3 low, traders know that the completion of thewhole Wave-C was near completion. The rally above the Wave-4 highsignaled Wave-C should be complete.The Trading Strategies and Putting It All Together Chapters will teachyou much more how we use the pattern position to help make specifictrading decisions.
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Pattern and Practical Elliott Wave Analysis
Wave Structure ChecklistsOn the following two pages are two checklists to help you monitor thewove structure of a market as it is unfolding. In effect, they are a concisesummary of the rules and guidelines of typical three and five wavestructures. There is an Impulse and Correction checklistAs a market unfolds, it is continually providing information as to itsnature, impulsive or corrective, in accordance with the wave guidelines foreach wave structure. While these checklist tables do not provide for everypotential wave structure, they will help you keep on track with how thetypical wave structure unfolds. If a wave structure violates a guideline forhow it should unfold, you must consider that it is not unfolding as youoriginally anticipated. You must then re-evaluate the position of themarket according to the best best alternative wave structure.Because a corrective wave structure can take any number of complexstructures, only the simple corrective zigzag (ABC) or triangle (ABCDE)are noted in the Correction Checklist. One a market demonstrates it isgoing to unfold in a complex correction, there is little predictability leftin the wave structure. The trader must then focus on the time and priceposition Cor signals [hat the correction may be terminating.These two tables do not consider the time or price position of themarket. They only consider the pattern position out of context of theother market factors. Never make a trading or investing decision based onpattern position alone. This has been the downfall of many Elliott waveanalysts.Also keep in mind that all markets have not agreed to unfold accordingto R. N. Elliott's rules and guidelines. Markets have a mind of their ownand will often unfold in a completely non-predictable and non-symmetrical pattern that provides little valuable information to the analyst.These checklists will go a long way in helping to identify whether amarket is in an impulsive or corrective position. Even more importantly,they will help to identify when a market is unfolding in a predictableElliott wave pattern and the signals necessary to confirm or invalidate theassumed pattern.Always keep in mind the purpose of technical analysis for traders andinvestors: To identify high probability trade and investing set-ups. Not toknow the position of every market at all limesIt will not be long before you will be familiar with Elliott wavestructures and will not have to refer to the tables. Until then, these tableswill be a quick and easy reference to the probable position of any marketat any time.
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PULSE WAVE CHECKLIST (Bull Market Example)
on
Wave 1
Wave 3
Wave 4
Wave 5
Refer To Corrective Table
3 Sub-Waves
Corrective WaveRefer To Currective Table
Usually 5Sub-WavesUnlessDiagonal Triangle.
5 Waves Up
3
Waves
Down
5 Waves Up
3 Waves Down
OK.
Completed
Zigzag
OK.
Complete Zigzag Or
Wave A of 2º
W3 Must Be 5 Waves.
Wave A Of Wave A.Complex Sideways Correction.
Wave 2Corrective Wave:
5 Sub Waves
Or
Probably The Start Of a
ach
3 Waves Up
5 Waves Down
3 Waves Up
It
Correction Is ProbablyNot Over. Prepare ForThe Reasumption of ThePrevious Trend
Wave Aof Zigzag OrResumption of Prior Trend?
Something Wrong WithCount.Review Wave Count.Wave 3 Must Be 5 Waves.REFER BACK TOCORRECTION TABLE
oOr
eunt
REFER BACK TOCORRECTION TABLE
When Wave 2 Complete,Draw Parallel Channel(0-W2 From W1) ForPotencial W3 Objective
Price Range of W3 Is UsuallyW2 Should Not Exceed
Greater Than W1. If Not, Beware
The Beginning of W1.
tHAT MAY BE A WAVE C.
If It Does, The Prior TrendShould Continue.
If W3 Is Shorter Than 162%
REFER BACK TO
Of W1, W5 Will Offen Be
CORRECTION TABLEThe Extended Wave.When W3 Complete,Draw Parallel Channel(W1-W3 from W2)For Potencial W4 Objectives.
5 Waves DownProbably Wave AOfZigzagCorrection.
Pattern and Practical Elliott Wave Analysis
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Dynamic Price Analysis
Every market makes a top or bottom on some exactmathematical point in proportion to some previous move.W. D. Gann
In the Dynamic Price Analysis chapter you• Learn how to project well in advance the pricezones which have the greatest probability of support,resistance and trend change, allowing the trader plentyof time to prepare for trading action.• Learn the three most important price projectiontechniques: price retracements, alternate priceprojections and price expansions.• Learn which ratios to use with each price projectiontechnique.• Learn how the price projections cluster to formsupport, resistance and trend reversal price zones.• Learn how to integrate price projections of wavesof more than one degree.• Learn how to integrate dynamic price analysis with thepattern analysis learned in the prior chapter.
Dynamic Price Analysis
Be Prepared In Advance For The Price Targets Of Trend ReversalsThis chapter will teach you in quickly and easily project the price targetswith the greatest probability for support, resistance and trend reversal. Itis not complicated or time-consuming to prepare in advance the DynamicPrice Projections.
The example above is not an isolated example of a price projection forthe termination of a trend. Dynamic Price projections will often allow youto determine well in