DOW JONES-(Elliott Waves at Work)

**marketwavez** · 05-09-2006, 10:55 AM

looking closer

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**EMphase** · 05-09-2006, 05:47 PM

Hey
I know you say counts are subjective but not all is. When its very hard to count it can become subjective but when its easy to count all EW analysts should come up with the same count.

EWI according to the books and myself recognize this as the almost 100% certain count from 1929 to 1974. There is simply no error with it so you have to count from that "certainty". You didn't knew probably about before 1974 thats why you started labeling with I and II during those years.

Where it becomes more subjective is between 1974 and 2006 and I agree with you that this can be very tought to count.

http://www.emphase.ca/images/at/DJIA1.gif

http://www.emphase.ca/images/at/DJIA0.gif

**skiracer** · 05-09-2006, 07:16 PM

Originally posted by EMphase

Hey
I know you say counts are subjective but not all is. When its very hard to count it can become subjective but when its easy to count all EW analysts should come up with the same count.

You got the wrong very long-term count and it's making your long term count wrong too. However luckily you are coming up with the good conclusion: the markets are most likely bullish. Please view this that I made for you and everyone here.

EWI according to the books and myself recognize this as the almost 100% certain count from 1929 to 1974. There is simply no error with it so you have to count from that "certainty". You didn't knew probably about before 1974 thats why you started labeling with I and II during those years.

Where it becomes more subjective is between 1974 and 2006 and I agree with you that this can be very tought to count.

http://www.emphase.ca/images/at/DJIA1.gif

http://www.emphase.ca/images/at/DJIA0.gif

Why would anyone want to do a wave count from 1974 to the present? Please explain what value it could possibly have if you are swing trading in todays markets. Even if you are a buy and hold investor I just don't see the necessity.

**ParkTwain** · 05-09-2006, 08:22 PM

voodoo, don't you think?

**skiracer** · 05-09-2006, 08:52 PM

Originally posted by ParkTwain

voodoo, don't you think?

Absolutely voodoo. What do you think Park? Do you think it would be worthwhile to do an EW count from 1974 to the present for your investments in todays markets. If so please support the argument or anyone for that matter. If you're trading equities in todays markets how would that count help your take on the markets today and would or could you base your trading decisions on any part of it. Does anyone think that they could determine or rely on pointing out a specific trend from it? Or say that the market will be doing this because of that EW count. Personally I'm living in todays trend and that is my reality until I see it change. Then that becomes my reality. Of course cyclical traders will disagree that specific stocks repeat trends or moves in cycles year over year and that you can play them accordingly. I can accept that to a degree but not an EW count going back to 1974 or even to a much shorter time frame like 2003 or 2004. My position is that todays environment is based on alot of economic factors happening withing a short based time frame from perhaps a few months back to the present. I'd like to hear what anyone else has to say either in support or against my position.

**EMphase** · 05-09-2006, 10:03 PM

Because the market is a fractal according to EW. The big wave such as cycle waves can give you alot of information about the smaller degree ones but the smaller degree ones can't give you information about the bigger degree ones. Supercycle wave started in 1932 something and MAY have ended in 2000 but it's unsure yet. Cycle wave V is the hardest wave to count unfortunately. If you can understand Cycle wave V which is a 20+ years wave, then you can understand 3-5 years wave and if you understand 3-5 years wave you have good insight on 6months-2years wave and if you have good understanding of that it will get you the the short term..

It's not voodoo. The technique is very well written and have direct application in today's market.

The market is moving by the law of demand and supply. Fear and greed will always be present be it in 1929 or in today's market. The human psychology is the same over time be it over a long period of time or a small period of time and this creates "human" or "nature" patterns which are the 1,2,3,4,5,a,b,c waves with all the theory to back it up.

**ParkTwain** · 05-09-2006, 10:12 PM

Does EW present the mechanism that produces the wave or wave system? There are (at least a few) laws of economics, an admittedly "soft" science. No mechanism, or even no hypothesis of the mechanism, then you're left with hunches and superstitions. Or dressed-up voodoo. Prechter himself is basically in seclusion. He can't make his theories explain what has actually happened since 1981. He's not someone to be following.

Instead, learn the mechanisms and processes that drive phenomena. Price and volume, supply and demand, financial instruments and institutions, economics.

**EMphase** · 05-09-2006, 10:20 PM

EW theory explain the mechanism behind it but mostly based on psychologic aspects of the stock market. Reading the chart correcting to identify the waves is more of an art than pure science however. The rules are there but human mistakes are there too.

Instead, learn the mechanisms and processes that drive phenomena. Price and volume, supply and demand, financial instruments and institutions, economics.

I already know that. I didn't study 5000 pages of quantitative, economics, analysis of financial statements, corporate finance, portfolio management, makrets equity, alternate investments, debt, derivatives investments for nothing. I'm showing alot of EW here on these forums but I do my share of research on other aspects of the market or of the securities I'm actually trading/investing.

**ParkTwain** · 05-09-2006, 10:37 PM

What is the mechanism, or combination of mechanisms, in the real world that produces the Elliott Waves?

**spikefader** · 05-09-2006, 11:48 PM

Guys, I am a skeptic about total market price action being 'explainable' by EW theory. But then again, I'm just a fuzzy logic kinda guy

Maybe I just need more time to study it before I can find a way to agree with the presumptuous belief that total price action should follow human designed rules. Let's face it; markets just sometimes do what they want to do and will break a perfect looking count and shock the most educated EWer.

The long-term chart back to the 1930s appears to be 'countable' (gotta love that 1942 'c' hehehe) BUT I'd really have to study EW more before I shoot EMphase down in flames and say it's voodoo. And studying EW more isn't on my list of priorities, an may not ever be......

But as limited as my EW education is, I think it's safe to say that I believe without question that impulse price action does have validity in the markets. I think it reflects the undeniable human element of what makes a market....whether it's over-exhuberant buying behavior, or overreaction selloff on fear or simple day-to-day price discovery, retracement to support, and continuation of a trend.

I think impulsive behavior is something we can all pretty much count on as existing on the time continuum, at least while there is a free market and humans remain the emotional and knuckleheaded beings that we are. If there is a huge change in international free markets or human psychology in the markets.....then who knows....EW theory may well fall.

But at this point in my trading life I very much appreciate EW price action, the impulsive 12345 movement and the 'c' corrective area. I choose to call correctives beyond 'c' as 'wash' until price displays impulsiveness again, whether that's continuation or breakdown of the 'c' area.

And whether you believe that long-term EW chart that was posted is going to help your swing trades or not is something that should be put into perspective, attaching the correct amount of weight to. Long-term charts do have a bearing on bias I attach to any chart. But it's an entirely relative thing; if one cannot apply the logic effectively then what's the use in trying? But if one can.....then great!.....use it as an edge and make money.

It's an interesting topic, and in my view if one fails to at least appreciate that EW theory has some value, with things like impulsive moves and correctives and 'c' longs and 'c' failures, then you're not 'listening' hard enough. EW is definately worth learning the basics of, and perhaps forming a finer appreciation of. I'll be a reader of any good EW thread.

And I love what marketwavez wrote in his first post:

"-It is not for everyone..... only for those who understand that the true Holy Grail of trading is learning to manage Risk vs Reward ."

That is pure genius And never a truer word has been written.

**marketwavez** · 05-10-2006, 04:10 PM

Here's What's up ,

ELLIOTT WAVES is just a methodology .

That's right just another trading method to show Probablity -

That's all it is - .....Probablity

- It could be wrong - It could be Right .....

Bottom Line :
It must be utilized within the context of analizing Risk-vs potential Reward
wich is the keys for success in the long haul .
--------------------------------------------------------------------
Not all trade setups succesfull .

Only a humble student of the Elliott Waves . -

**marketwavez** · 05-10-2006, 04:50 PM

This style of trading is not for everyone .

We are not all the same ......... We are all built diffrently .

We all have diffrent experiences and more importantly don't see the charts or the world the same way . This is why if you gave the same chart data to 10 diffrent people who interpret the Elliott Wave you will come up with diffrent wave counts .

Does it mean someone has the wrong wave count? ..... No !
It doesnt mean this at all ......

It's all a matter of perception . -

in which some times is greater than reality , by the way .

I leave you with my trading motto for now
-----------------------------------------------------------------------

Professionals are concerned with Risk to Reward

- Everybody else is concerned with being right all the time .

**EMphase** · 05-10-2006, 05:14 PM

You are forgetting this:

How do you justify your count with this historical data that you didn't consider.

http://www.emphase.ca/images/at/DJIA1.gif

**skiracer** · 05-10-2006, 05:49 PM

Originally posted by marketwavez

Here's What's up ,

ELLIOTT WAVES is just a methodology .

That's right just another trading method to show Probablity -

That's all it is - .....Probablity

- It could be wrong - It could be Right .....

Bottom Line :
It must be utilized within the context of analizing Risk-vs potential Reward
wich is the keys for success in the long haul .
--------------------------------------------------------------------
Not all trade setups succesfull .

Only a humble student of the Elliott Waves . -

There are a number of people here who have been talking about the signifance of r/r and developing a strict strategy or discipline of entry, target, stop losses for quite some time. Please don't think you're giving us something new or a revelation. Back the EW stuff up with some solid info or charts and picks based on those counts. Always ready to listen and learn something new as long as it's supported with factual stuff.

DOW JONES-(Elliott Waves at Work)

DOW JONES-(Elliott Waves at Work)

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