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# Elliott Wave - Queries on Wave 1

Discussion in 'Technical Analysis' started by justprash, Dec 17, 2011.

1. ### justprash

Hi,

I have been trying to get myself upto speed on Elliott Wave patterns. Recently I started to practice the EW counting based on theory I learnt on some EOD charts. One of the hurdles that I come across is about possible Wave 1 completion.

For e.g., Assume we just finished 1 cycle, 1-2-3-4-5-A-B-C. Now assume we are starting on Wave 1. How do we know that Wave 1 is possibly complete? Here are some subqueries based on this:

1) Only wave is we find another wave which retraces this so-called wave 1 between 38.2 - 61.8% and we label this correction wave as Wave 2.
2) Does wave 1 have to exceed some portion of previous C wave?
3) How do we also know that Wave 1 is extended?

Request people practicing EW to help me out on these beginner queries!

Thanks & Regards,
Prash

2. ### Wide Tailz

Here is an amateur's opinion, based on the basic EW rules.

You never know wave 1 is finished until wave 3 exceeds the wave 1 peak.

I know of no magic number or indicator that will tell you in advance.

Trend following tactics come in real handy when attempting to trade EW style. They work so well you don't even need EW......

3. ### nazzdack

1) As a rough guideline, the price magnitude on the next wave-1 can be equal to or "1.618 times" the magnitude of the previous wave-1.
2) The next wave-1 can merely have a "well-defined", 5-wave, appearance in structure.
3) There can be some type of "obvious" volume spike at the end of the next wave-1.
4) Wave-1's are "impulsive". They move far,quickly. Wave-2's are "corrective". They retrace, slowly. If you believe you've identified a completed "1" that all of a sudden moves sideways, slowly, chances are you're'in sync" with the actual wave pattern being traced out.
5) Wave-1's tend to move contrary to the lingering market sentiment in the prior c-wave.
6) Look in the textbook for the guidelines regarding extensions, which are more likely to occur in "3" and "5".

EW is very simple.

If you think you have had a wave 1, or a wave A.

Wave 2, or wave b, cannot exceed the low of wave 1, or wave A.

Wave 3, or wave C, cannot be the shortest wave, and it cannot exceed the low of wave 2, or wave B.

Wave 4 cannot exceed the low of wave 3.

Wave 5 cannot exceed the low of wave 4.

It really is just that simple.

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