Wave Counts & Updates - Lionheart Elliott Wave Analysis

Introduction To Elliott Wave Theory - Overview Of The Wave Principle

Introduction To Elliott Wave Theory - Overview Of The Wave Principle
Introduction To Elliott Wave Theory - Overview Of The Wave Principle
Read the rest of the post before coming back to this. “Elliott Wave Principle: Key To Market Behavior” by Robert Prechter, A.J. Frost is the bible when it comes to the Wave Principle. If you are serious, buy the book. I am NOT your guru, I don't want to be either. If you want to learn this, really learn it, then the book will be your guide. What I can do is share my experience and perspective.
This doesn't apply to everyone, but if you are thinking about DMing me for signals, don't. If you want to message me to ask questions, please do! But PLEASE don't ask for mentorship or tutoring. I don't have the time and I don't have the inclination to get into that business. I enjoy posting here, don't fuck it up for me.
My Rambling Thoughts First
I’m actually really glad to be finished with my “10 Minutes Per Day Trading Strategy” series. I think it was valuable information and the feedback I have received so far seems to corroborate my thoughts. I wanted to provide a step-by-step a full-out trading strategy that you can start applying immediately. I’ve designed countless trading systems over the years out of curiosity, not necessarily desire. One thing that all my strategies have in common is that they pattern themselves after the Wave Principle.
THIS is the good stuff. THIS is the Holy Grail that EVERYBODY is chasing. The funny thing is that understanding the Wave Principle doesn’t necessarily make you a great trader… but it will give you a forecasting ability that 99.9999% of other market participants simply do not have. I have been studying human behaviour (including financial markets) through the prism of the Wave Principle since 2005 and I have been hooked ever since. I have been doing this a long time and I have seen it ALL. Trust me, I have seen it all. There is NO OTHER OBJECTIVE FORECASTING METHODOLOGY AS PRECISE AS THE WAVE PRINCIPLE. I can’t emphasize this point strongly enough. You want to be able to forecast where prices go, you master R.N. Elliot’s initial body of work, which has since been built upon by Bob Prechter and his team.
The Wave Principle is unfortunately one of the most misunderstood concepts in all of finance, economics, sociology, and investing/trading. Ironically, this is very fitting, as most people do not understand how to forecast human behaviour. If more people could forecast human behaviour according to the Wave Principle, perhaps we would need a new modelling technique.
The beautiful thing about the Wave Principle is that it can take a very short amount of time to understand, but it will likely take years and years for real mastery. If there is one thing that all human beings, including traders, have in common it is that the vast majority of the population is too lazy and undisciplined to be able to really master anything. And so, most people give up on Elliott Wave, or even worse, they apply it haphazardly without really knowing what they are doing.
What Elliott Wave Is… And Isn’t
The Wave Principle is a forecasting methodology, it is NOT, NOT, NOT a trading strategy. You can build trading strategies around the Wave Principle, but it is not in and of itself a trading strategy. The Wave Principle will help inform you of where prices are going (sometimes 1, 2, even 3 or 4 steps ahead!), but it does not tell you how to make money off of those movements. Consequently, IF I decide to go through with a comprehensive series of posts on the Wave Principle, I will not be sharing a strategy with you. I will be sharing with you enough so you can get started on your own journey with the Wave Principle.
So… If Elliott Wave Isn’t A Strategy, How Can I Make Money?
This is a great question, and it is one I wrestled with for over 3-4 years when I was first in the markets. The answer is that the Wave Principle gives us some amazing rules and guidelines. Most importantly, it tells us where we are wrong… something which is crucial for identifying stop loss placement. Secondly, it gives us probabilistic guidelines for where price is going next which is important for targets. Where the Wave Principle does not offer much guidance is where to enter a trade. This is not the Wave Principle’s objective, however, so let’s remember that.
Every strategy revolves around the Wave Principle, whether intentionally or not. You can’t avoid it, much like you can’t avoid breathing air. My day-to-day technical analysis revolves around a combination of different classical chart patterns, specific Elliott Wave patterns, and what people like to call “harmonics”, which are really just combinations of different Wave Principle rules and guidelines thrown together.
Please Tell Me If There Is Any Interest In This
It’s a long hard slog for me to produce this content. I have a busy day job actually trading and participating in the markets on top of a whole host of other responsibilities. I don’t want to do this if people aren’t willing to commit to the ride, because it’s a long one. It will take me a few months to write everything out if I stick to my usual routine of 1 post/week on average. I don’t mind doing this because I am so passionate about this specific topic, but I don’t want it to be a waste either.
If you guys are interested, then I'll start cranking away more content and I promise you will have a much better understanding of how to apply the Wave Principle.
Because people only respond to visuals, I’ll include below some charts and forecasts I have made over the recent past on TradingView.
These are all historical charts presented in before and after style. This has nothing to do with my personal forecasting ability. I couldn't post more than 20 images as per Reddit's posting tool, but this should be enough to get the picture. I am simply following the rules and guidelines laid out by the Wave Principle I learned by reading Bob Prechter’s book (and yes... of course I lose trades too):




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Elliott Waves Series Part 2 - The Broad Concept

Elliott Waves Series Part 2 - The Broad ConceptYou can find Part 1 here: https://www.reddit.com/Forex/comments/hieuyw/introduction_to_elliott_wave_theory_overview_of/
The primary value that the Wave Principle (from here on out, abbreviated to WP) confers on market analysts is the ability to provide context for market behaviour. Having context is incredibly important. To put it simply, the WP can be thought of as a compass. Whenever you feel lost looking at a chart (ANY chart, ANY market!), the WP will help get you back on track.
Clearing Up Some Misconceptions About Elliott Wave Theory:

  1. R.N. Elliott first discovered the WP in the 1930s using charts of the stock market. Many misinformed people believe that the WP works “best” on stocks and has been adapted for use in other markets. This is simply false. To be clear - Elliott discovered the WP. He did not invent the WP. The WP is based on human social nature and therefore it cannot be invented. It has always existed. What Elliott did was to start codifying rules and guidelines around how human social nature can be charted. Ultimately, Elliott’s objective was to be able to predict future human behaviour using the historical record. The expression of human social nature generates forms and patterns. As these forms and patterns repetitive, they have enormous predictive value.

  1. Another major misconception around the WP is that it requires a lot of discretionary analysis, and more often than not, analysts shoehorn price action to fit the Elliott Wave model. In fact, the WP has very clear rules (these rules are inviolate under any circumstance) and guidelines (these guidelines should be adhered to almost 100% of the time). While there is a discretionary element involved in counting waves, properly trained wave analysts will ultimately arrive at a consensus because following the rules and guidelines narrows the possible wave counts very quickly. Very often Wave analysts will have 2 counts at hand in terms of where they think the market is presently situated. These counts are known as the preferred count and the alternative count. These counts are validated and invalidated using price levels derived from Elliott’s rules and guidelines. The most dissent I expect from two educated Wave analysts is that one analyst’s preferred count could be the other’s alternative count. This dissent quickly resolves itself as the price action develops and validates or invalidates one count or the other. This dissent usually occurs based on wave patterns of one higher degree. It is very rare that I have seen dissent on immediate market movements.

  1. I didn’t know this was a major misconception, but someone brought this up in my first post, “I stated that Elliott Theory has better success when working in consolidations or extreme ranging markets.” This is completely false. The WP doesn’t work better or worse regardless of the market or the market conditions. That would be like saying that breathing air only works occasionally. The WP is NOT a strategy, it is the definitive model for charting human herding behaviour. Human behaviour does not show up only in periods of consolidation or range-bound markets. The markets are themselves driven by human behaviour, therefore the WP is always equally applicable. From a trading perspective, the WP is perfectly suited to capturing trends.

  1. Well, what about news events? What about supply and demand theory? What about fundamentals?! Doesn’t any of this stuff matter?? In short, the answer is no. I have previously stated that I am a macro-based investor. This is certainly true. Much of the research I consume has to do with market fundamentals and global-macro analysis. This research helps me form a view that I can overlay with the WP. From a trading perspective, when it comes to actually pulling triggers and taking positions, my decisions are always guided first and foremost by the WP. Here is a fantastic quotation from Bob Prechter on this topic, “Sometimes the market appears to reflect outside conditions and events, but at other times it is entirely detached from what most people assume are causal conditions. The reason is that the market has a law of its own. It is not propelled by the external causality to which one becomes accustomed in the everyday experiences of life. The path of prices is not a product of news. Nor is the market the cyclically rhythmic machine that some declare it to be. Its movement reflects a repetition of forms that is independent both of presumed causal events and of periodicity.”
The Bottom Line:
Elliott Wave Theory is the best forecasting tool in existence. It has determined that the market’s progression unfolds in waves. Waves can be thought of as patterns that carry the market in a direction. There are a fixed number of the different kinds of patterns these waves can take. If you really boil this down to its essence, successfully applying the WP is as simple as identifying what kind of wave the market is currently in.
I will end this now. The next part will deal with the overriding wave structure that the market is in, the different kinds of waves we will see, and why this wave structure exists in the first place.
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ELLIOTT WAVE THEORY - Double zig zags

ELLIOTT WAVE THEORY - Double zig zags
Hi everyone; I'm just a newbie to Forex and after completing the Babypips course I really like the concept behind the EWT and start studying "Elliott Wave Theory: A Key to Market Behavior" (Frost & Fletcher).
Taking advantage of the late interest in the subject (I wanna thank u/ParallaxFX for his recent post about it) I wanna ask for a little help.


Ok, so in this two pictures the book talks (and shows) about zig zags, a formation that could happen in corrective waves. I understand it and I can see it (in the book examples obv.).
The problem comes with one of the examples of double zig zags:

So, correct me if I wrong:
  • (Y): The second zig zag; made of a (5), b (3) and c (5).
  • (X): the "separating three"; made of w, x and y.
  • (W): here is where I have the problem. I understand that W is the first zig zag, so it should have the 5-3-5 formation seen in (Y), but I couldn't see it. I count the first five: 1, 2, 3, 4, 5; but then I can't see the three and the five, unless the triangle is counted otherwise.
Anyone can help me to see the double zig zag? If the book put the image as example I imagine it will be an easy one, just I can't see it.
Thanks in advance.
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96 Elliott Wave and Zigzag (5-3-5)

96 Elliott Wave and Zigzag (5-3-5)
96 Elliott Wave and Zigzag (5-3-5)
A single zigzag in a bull market is a simple three-wave declining pattern labeled A-B-C. The subwave sequence is 5-3-5, and the top of wave B is noticeably lower than the start of wave A, as illustrated in Figures 1-22 and 1-23.
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In a bear market, a zigzag correction takes place in the opposite direction, as shown in Figures 1-24 and 1-25. For this reason, a zigzag in a bear market is often referred to as an inverted zigzag.
Occasionally zigzags will occur twice, or at most, three times in succession, particularly when the first zigzag falls short of a normal target. In these cases, each zigzag is separated by an intervening "three," producing what is called a double zigzag (see Figure 1-26) or triple zigzag. These formations are analogous to the extension of an impulse wave but are less common. The correction in the Dow Jones Industrial Average from July to October 1975 (see Figure 1-27) can be labeled as a double zigzag, as can the correction in the Standard and Poor’s 500 stock index from January 1977 to March 1978 (see Figure 1-28). Within impulses, second waves frequently sport zigzags, while fourth waves rarely do.
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R.N. Elliott’s original labeling of double and triple zigzags and double and triple threes (see later section) was a quick shorthand. He denoted the intervening movements as wave X, so that double corrections were labeled A-B-C-X-A-B-C. Unfortunately, this notation improperly indicated the degree of the actionary subwaves of each simple pattern. They were labeled as being only one degree less than the entire correction when in fact, they are two degrees smaller. We have eliminated this problem by introducing a useful notational device: labeling the successive actionary components of double and triple corrections as waves W, Y and Z, so that the entire pattern is counted "W-X-Y (-X-Z)." The letter W now denotes the first corrective pattern in a double or triple correction, Y the second, and Z the third of a triple. Each subwave thereof (A, B or C, as well as D or E of a triangle — see later section) is now properly seen as two degrees smaller than the entire correction. Each wave X is a reactionary wave and thus always a corrective wave, typically another zigzag.
Figure 1-24

Figure 1-25
Flat (3-3-5)
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A flat correction differs from a zigzag in that the subwave sequence is 3-3-5, as shown in Figures 1-29 and 1-30. Since the first actionary wave, wave A, lacks sufficient downward force to unfold into a full five waves as it does in a zigzag, the B wave reaction, not surprisingly, seems to inherit this lack of countertrend pressure and terminates near the start of wave A. Wave C, in turn, generally terminates just slightly beyond the end of wave A rather than significantly beyond as in zigzags.
Figure 1-29

Figure 1-30
In a bear market, the pattern is the same but inverted, as shown in Figures 1-31 and 1-32.
A flat correction usually retraces less of the preceding impulse wave than does a zigzag. It tends to occur when the larger trend is strong, so it virtually always precedes or follows an extension. The more powerful the underlying trend, the briefer the flat tends to be. Within an impulse, the fourth wave frequently sports a flat, while the second wave rarely does.
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What might be called a "double flat" does occur. However, Elliott categorized such a formation as a "double three," a term we discuss later in this chapter.
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The word "flat" is used as a catch-all name for any A-B-C correction that subdivides 3-3-5. In Elliott literature, however, three types of 3-3-5 corrections have been named by differences in their overall shape. In a regular flat correction, wave B terminates about at the level of the beginning of wave A, and wave C terminates a slight bit past the end of wave A, as we have shown in Figures 1-29 through 1-32. Far more common, however, is the variety we call an expanded flat, which contains a price extreme beyond that of the preceding impulse wave. Elliott called this variation an "irregular" flat, although the word is inappropriate as they are actually far more common than "regular" flats.
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In expanded flats, wave B of the 3-3-5 pattern terminates beyond the starting level of wave A, and wave C ends more substantially beyond the ending level of wave A, as shown for bull markets in Figures 1-33 and 1-34 and bear markets in Figures 1-35 and 1-36. The formation in the DJIA from August to November 1973 was an expanded flat correction in a bear market, or an "inverted expanded flat" (see Figure 1-37).
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In a rare variation on the 3-3-5 pattern, which we call a running flat, wave B terminates well beyond the beginning of wave A as in an expanded flat, but wave C fails to travel its full distance, falling short of the level at which wave A ended, as in Figures 1-38 through 1-41. Apparently in this case, the forces in the direction of the larger trend are so powerful that the pattern is skewed in that direction. The result is akin to the truncation of an impulse.
It is always important, but particularly when concluding that a running flat has taken place, that the internal subdivisions adhere to Elliott’s rules. If the supposed B wave, for instance, breaks down into five waves rather than three, it is more likely the first wave up of the impulse of next higher degree. The power of adjacent impulse waves is important in recognizing running corrections, which tend to occur only in strong and fast markets.
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We must issue a warning, however. There are hardly any examples of this type of correction in the price record. Never label a correction prematurely this way, or you’ll find yourself wrong nine times out of ten. A running triangle, in contrast, is much more common (see next section).
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If you hated my previous TA, prepare to barf out a lung as I introduce you to Elliott Waves! :)

I thought I would share this here, I put this together last night to show the two possible scenarios that should be unfolding.
Elliott Waves are fairly complicated to explain in a few paragraphs, but the short story is that the market moves in waves.
You have the major trend which will unfold in moves made up of 5 waves, when those are complete, you get a 3 wave corrective move.
These patterns work in all time frames from decades right down to the 1min.
The longer the time frame, the "clearer" the waves are. The shorter the time frames, the more messy it can get.
Last night I put this together: http://i.imgur.com/KG0OU.gif
Im pretty bearish here so I am very comfortable counting 5 waves down. The question last night was whether we completed this 5 and are now doing an ABC corrective higher, or if we still have a leg down to go.
The red numbered count showed the alternative scenario.
This morning we got our answer and the white wave count looks like its the correct one.
If this Elliott analysis works out, once we top at at wave C, this market will be due for a hard pull back to new lows below that 1215 from yesterday. Im looking for some topping action above 1260, I plan on loading SPY Dec puts above that range if I see resistance come in.
IF this ABC correction does indeed stall out soon, be warned that the next leg down (according to Elliott Wave theory) will be ugly! (or beautiful if you are positioned correctly).
If any of you are Elliott Wave experts, feel free to chime in.
You may recognize this type of work from Todd Gordon on CNBC when he talks about his FOREX trades.
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Elliot Wave Weekly Forex Market Analysis Webinar 20 Nov 2017 Forex, Elliott Wave Count in EUR-AUD. See how an Expanded ... Elliott Wave Theory Analysis - YouTube Elliott Waves Forex Strategy Elliott Wave Explained - YouTube Elliott Wave + Market Structure Weekly Forex Analysis  25-29 May 2020 How To Count The Elliot waves Like A Pro - YouTube This Is How I Set Up My Elliott Wave Indicators ... Sat 11 Forex Elliott Wave Analysis Navigating the Markets with Elliott, Fibonacci and ...

R.N. Elliott, in his work “The Wave Principle,” defined some specific patterns that tend to repeat across the time. These patterns are built by different structural series that the wave analyst should know before to start the counting process. These Elliott wave structures are formed as follows. Impulsive waves (:5) Impulse – 5-3-5-3-5 doubts will come if we don't find the right spot in the wave count, because Elliott Wave are very subjective in their use, for more objective I think you should add MACD to the chart to find out the difference between each wave. regards Arief- EW = Psychological Human Behavior. Post # 4; Quote; Oct 4, 2020 11:54pm Oct 4, 2020 11:54pm corongumet. Joined Dec 2018 Status: Trading For Living ... ELLIOTT WAVE COUNTS Elliott Wave Swing Sequence and Count provides higher degree of confidence and accuracy to stay at the right side of the market 24 HOUR CHAT ROOM Our technical analysts stand ready 24 hours from Monday – Friday to provide the latest market update and answer your market question ... You will notice that I employ my own sub numbering or labelling to help me identify from where the wave count is based. This is evident on the smaller time frame of 1H. I try to determine the wave counts on lower time frames when ever possible. EG Basics of Elliott Wave Principles Corrective Wave Patterns_Summarized Form Part 1 Based on Figures gathered from Elliott Wave International ... Elliott Wave International is the world’s largest independent financial forecasting firm. We have guided our subscribers through major market and economic moves for over 40 years. Elliott Wave Counts Forex-Metals-Indices-Crypto Nov-6-2020 Elliott Wave Counts Forex-Metals-Indices-Crypto presented below are to be treated as intraday analysis and updates for the overall patterns. The screen-shots contain high-probability insights and have been taken on either 2H or 4H time-frames. Technical Analysis Markets FX MAJORS DXY EUR/USD GBP/USD USD/JPY Posted in ... Wave counts traders are following now Trading with Elliott Waves Back in 1934, Ralph Nelson Elliott discovered that price action displayed on charts, instead of behaving in a somewhat chaotic ...

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Elliot Wave Weekly Forex Market Analysis Webinar 20 Nov 2017

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