STI Elliot Wave Analysis June 2013

Was free and took a quick look at STI.

I realised the waves are so crystal clear... Well, I may be reading it wrongly.

What this count means:
This is a correction, and STI will still go further up. (1) is 384 points long. If I expect (4) to end at around 3200 or below, and (5) to be almost as big as (1), then 3800 plus is achievable!

Discount that maths, my guess is that the end of the more major 3rd wave will end at the 2007 peak, which is around 3800.

The crystal ball would probably go on to tell me that a correction is then around the corner, and for a 4, it probably would be quite draggy :(

Further that, the 5. This wave 5 would be tricky, and how far it would goes really depends, since wave 1 is so short. The cardinal rule of EW theory is that wave 3 cannot be the shortest wave, and it is already satisfied in this count. But STI 4000 should be a good guess?

Of course, all these will be wrong if the current STI breaks below 3036, where wave 4 crosses 1, another cardinal rule of EW theory that cannot be broken.

STI -- My Attempt on Andrews Pitchfork with Elliott Wave

The following is my attempt of using Andrews Pitchfork together with Elliott Wave counts. As of now, I'm on the fourth count of the 5 wave impulse extension of a 3rd wave. The Andrews Pitchfork begins on the first of the 5 wave impulse, starting from 2729.43 on 30th Nov 2009.

In Andrews Pitchfork, we are supposed to identify A pivot point followed by B and C as the peak trough pair. In my experiment here, A is the start of this impulse wave, followed by B as the end of wave i and C as the end of wave ii.

This is just an experiment; it may or may not succeed. In this experiment, STI should be bouncing off the bottom of the pitchfork, marking the end of the 4th mini wave and beginning the 5th mini wave.

Let's see how this goes....

STI (Hourly) Elliott Wave Practice

This is my attempt on counting waves on the hourly chart over 5 days using Yahoo's chart during lunch time. Chart is drawn on MS Word, so it's a little shoddy.

Looks like there's some further upside after lunch, before we see a A-B-C down and breaking the rising wedge being formed on the hourly.

Basic Elliott Wave Structure:

It does look like STI will go to around 2665, then move down to 2630 to form the A wave by Monday. If true, we will see STI peak later, then close lower by 5pm, forming a inverted V-shape today. Monday will see 2630 before a rebound to 2655 region, then another down, completing a head and shoulders.

Caveat emptor, this is just an experiment to test out Elliott Wave Fractal Theory. Of course, my counts might be wrong too.

Pre-empting the market too early?

I don't really understand why people attempt to pre-empt the market with Elliott waves when the waves are not near completion. Why jump so fast to short?

Reasons:
1) Corrective waves could be complex. This is expected to be a corrective wave at the primary level right? It could well be an A-B-C-X-A-B-C or a A-B-C-D-E triangle...

2) Impulse waves of C could have extensions too.

3) Although Elliott waves of different indexes do tend to move in tandem, there's no rule that state that they must do so.

I read somewhere, the cure to negative divergences could be even higher prices... I thought trading is about buy high sell higer, or sell lower buy lower... Hmmm....


Well, I'm still new and noob at trading. Am I missing something out?

Elliott Wave Count -- How do you know if you have the right wave count?

The article here striked this thought in me
http://www.elliottwave.com/freeupdates/archives/2008/09/03/How-Do-You-Know-If-You-Have-the-Right-Wave-Count.aspx

So how do we know if have the right count?
The following is lifted off from the website:

Here's a short-cut list of the personalities you should be looking for:

1) Impulse waves always subdivide into five distinct waves, and they have an energetic personality that likes to cover a lot of ground in a short time. That means that prices travel far in a short period of time and that the angle or slope of an impulse wave is steep.

2) Corrective wave patterns have a sluggish personality, the opposite of impulse waves. Corrective waves are slow-moving affairs that seemingly take days and weeks to end, and, during that time, price tends not to change much. Also, corrective wave patterns tend to contain numerous overlapping waves, which appear as choppy or sloppy price action.


Ok, that seems pretty normal and without much details. What strikes me most was the sentence that "each Elliott wave has a distinct personality, and personality supports labeling."

Example, wave 2 are often deep, and typically end on low volume, and typically retrace 0.382 of wave 1. So if we see a wave that retraces about 0.382 of the previous wave, yet ends on high volume, it is more likely an A-B-C count than a 1-2-3 count. It is the personality of the waves that count.

Another example... wave 4 usually meanders sideways for an extended period, with volume well below that of wave 3...


Guess I need to research more and pay more attention to the personality types of each individual waves... The alternate count recently released by DBS seems to hold some weight, although it appears to be different from the wave counts of Robert Pretcher, head of Elliott Wave International... It seems to me that Pretcher is at wave C now, not wave A as counted by DBS...

So much more to learn :(


Update: I just realised there's a section on wave personality in Elliott Wave International's Lesson 7. Going to learn more about it :)

A nice diagram from Elliott Wave International:

Elliott Wave Basic Theory and Wave Structure Part 1

This is the first post of my research on the Elliott Wave Theory.

Basically, Elliott Wave Analysis is only about identifying 2 types of wave structures, which are Impulsive waves and Corrective waves respectively. To do further analysis, we will have to make use of

(i) Relationship between the waves
(ii) The degree of the waves.
(iii) Fibonacci Tools
(iv) Trendlines and channels

and so on...

There are certain rules we must follow and many many guidelines to make use of in order to increase the accuracy of our counts.
This post aims to try to understand how to identify Impulsive and Corrective waves.


For traders experienced with Elliott Wave, he/she will be able to identify the Impulsive and Corrective waves immediately in one glance, and come up with one or more different wave counts which can all be valid. The purpose of wave counting is not so to get the correct wave counts, but more of identifying and recognizing what the next market trend is. Would it be a strong or weak wave? Would it be a simple or complex wave? Proper usage of Elliott Waves can give a trader the advantage of "timing" the market and to be able to be ahead of the market by a few steps.



*** More to come ***