Elliott Wave Analysis – Free Learning Materials
by ilene - March 5th, 2010 5:53 pm
Here’s a series of Elliott Wave Lessons from the recent week or so, all wrapped up into one post with several free offers from Elliott Wave International. As always, would love comments from anyone who has incorporated Elliott Waves into their trading methods or who has experience with the EW program. - Ilene
Learn Elliott Wave Analysis — Free
Often, basics is all you need to know.
Courtesy of Elliott Wave International
Understand the basics of the subject matter, break it down to its smallest parts — and you’ve laid a good foundation for proper application of… well, anything, really. That’s what we had in mind when we put together our free 10-lesson online Basic Elliott Wave Tutorial, based largely on Robert Prechter’s classic "Elliott Wave Principle — Key to Market Behavior." Here’s an excerpt:
Successful market timing depends upon learning the patterns of crowd behavior. By anticipating the crowd, you can avoid becoming a part of it. …the Wave Principle is not primarily a forecasting tool; it is a detailed description of how markets behave. In markets, progress ultimately takes the form of five waves of a specific structure.
The personality of each wave in the Elliott sequence is an integral part of the reflection of the mass psychology it embodies. The progression of mass emotions from pessimism to optimism and back again tends to follow a similar path each time around, producing similar circumstances at corresponding points in the wave structure.
These properties not only forewarn the analyst about what to expect in the next sequence but at times can help determine one’s present location in the progression of waves, when for other reasons the count is unclear or open to differing interpretations.
As waves are in the process of unfolding, there are times when several different wave counts are perfectly admissible under all known Elliott rules. It is at these junctures that knowledge of wave personality can be invaluable. If the analyst recognizes the character of a single wave, he can often correctly interpret the complexities of the larger pattern.
The following discussions relate to an underlying bull market… These observations apply in reverse when the actionary waves are downward and the reactionary waves are upward.
1) First waves — …about half of first waves are part of the "basing" process and thus tend to be heavily corrected by wave two.
…
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Wave Principle Crash Course: There’s No Going Back
by ilene - March 4th, 2010 8:20 pm
Wave Principle Crash Course: There’s No Going Back
By Nico Isaac, Elliott Wave International
For over ten decades, the mainstream financial world has embraced the view that external news events drive trend changes in the markets. In less than ten minutes, EWI’s senior tutorial instructor Wayne Gorman shatters that very idea into a fine dust, swept away into thin air.
In part one of his exclusive, three-part Club EWI video series "Why Use The Wave Principle," Wayne first assesses the pitfalls of relying on macroeconomic models to forecast; namely: "An investor is lured into the market at just the worst time, when it’s time to sell, and forced out just at the best time to buy."
As for real world examples of this happening, Wayne spans three hundred years of financial history to reveal how the most pivotal economic, political, and environmental events failed to alter the course of their respective markets. Here, the free video includes groundbreaking charts on these (and more) well known episodes:
- The S&P 500 and Enron from 2000-2002: The stock market ROSE and continued to proceed upward AFTER the largest US corporate scandal and bankruptcy ever (at the time).
- The Dow Industrials and GDP quarterly data from 1970 to early 2000s: After the release of major negative GDP numbers, the market for the most part ROSE, just the opposite of what most market analysts and investors expect.
- The Dow and profound political events over the last 80 years: In the 1930s and 1940s, a series of negative incidents — i.e. Hitler rising to power, World War II, and the Holocaust — preceded a powerful uptrend in stocks all the way into the 1960s.
- Stock market charts of the five countries most affected by the 2004 Indian Ocean Tsunami (India, Indonesia, Malaysia, Sri Lanka, and Thailand). Four out of the five ROSE after the natural disaster…
Believe it or not, we’ve only scratched the surface. In his myth-busting, free video "Why Use the Wave Principle," Wayne Gorman presents a total of 40 charts that capture failed fundamental analysis of the world’s leading financial markets. Wayne recalls this expression from a famous, Nobel Prize winning economist:
"Economic reasoning will be of no value in cases of uncertainty."
And he offers this response:
"But isn’t that what we have in financial markets: cases of uncertainty? We need a different type of reasoning, one that will help us to avoid the pitfalls shown on the previous charts.…
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Philip R. Davis is a founder Phil's Stock World, a stock and options trading site that teaches the art of options trading to newcomers and devises advanced strategies for expert traders...
Ilene is editor and affiliate program
coordinator for PSW.