The Elliott wave theory dates back to 1939 when R.N. Elliott detailed his belief that markets moved in well-defined waves that could be predicted and thus used to initiate profitable trades. The Elliott wave theory is based on mathematics, specifically on the Fibonacci series of numbers (1-1-2-3-4-5-13-21….).
Based on Elliott wave, market prices tend to move in a predetermined number of waves that are consistent with the Fibonacci series.
For example, Elliott believed that the market moved in five distinct waves on the upside and three distinct waves on the downside. These waves can exist at many levels simultaneously, so that there can be waves within waves as measured on different time scales. Primary waves can be broken down into smaller waves. Elliott placed particular importance on the golden mean, .618, as a significant percentage for retracement.
No Comments on "Elliott Waves To Predict Market Moves"