# Elliott Wave Analysis

• #### ByeTMO

Posted: 17 February 2012 01:22 AM #31

Does anyone trade on EW?  Just curious.

• #### Mace

Posted: 18 February 2012 12:44 PM #32

Preferred count updated.

Primary degree waves of Cycle degree wave V
———————————————————————-
V.1=\$78.20 to \$272.00, length = \$193.80
V.2=\$272.00 to \$199.25
V.3=\$199.25 to \$404.50, length = \$205.25
V.4=\$404.50 to \$363.32
V.5=\$363.32 to:
\$483.09, length of wave 5 = 0.618 of length of wave 1
\$557.12, length of wave 5 = length of wave 1 (no extension impulse)
\$564.97, length of wave 5 = 0.618 of length of wave 1 + 3
\$689.62, length of wave 5 = 1.000 of length of wave 1 + 3 )  Extended fifth wave impulse
\$891.27, length of wave 5 = 1.618 of length of wave 1 + 3 )  As above

Intermediate degree waves of Primary degree wave V.5
————————————————————————————
V.5.i   = \$363.32 to \$396.41, length = \$33.09
V.5.ii = \$396.41 to \$377.68
V.5.iii = \$377.68 to \$427.75, length = \$50.07
V.5.iv = \$427.75 to \$419.55
V.5.v = \$419.55 to \$526.29, length = \$106.74, about 1.66 of i + iii
Completion of V.5.v or V.5.i?
Looking from the bright side i.e. completion of V.5.i, then fib targets for V.5.ii are:
23.6% = \$487.83 (low so far is \$486.63, probably wave A)
38.2% = \$464.04
50.0% = \$444.81 (top of earning gap up)
61.8% = \$425.57 (start of earning gap up)
76.4% = \$401.78

[ Edited: 18 February 2012 12:48 PM by Mace ]

#### Signature

Stay Hungry. Stay Foolish.  - Steve Jobs

Posted: 18 February 2012 12:55 PM #33

Mercel - 17 February 2012 05:22 AM

Does anyone trade on EW?  Just curious.

Given Mace’s accuracy (excellent) in forecasting the last several moves: Algos…and the quants who wrote the algos.  Think of it as artificial intelligence…mathematical code that attempts to quantify human herd psychology and market sentiment.  It has a certain “IF, THEN…” logic.

[ Edited: 18 February 2012 02:36 PM by lovemyipad ]

Posted: 18 February 2012 10:21 PM #34

Okay, I’m trying to push through this throbbing pain behind my left eye. :D
Here’s my attempt:

Intermediate degree waves of Primary degree wave V.5 (bright side):
————————————————————————————
Impulse - V.5.i   = \$363.32 to \$526.29, length = \$162.97 = i
Retrace - V.5.ii = \$526.29 to:

V.5.ii.A = 526.29 to 486.63, (approx. 23.6% of V.5.i), length = 39.66
V.5.ii.B = 486.63 to:

506.46 = 50.0% of A (currently at 507.77, so maybe complete), length = 21.14
511.10 = 61.8% of A (higher invalidates current count??), length = 24.47

If B completes at 507.77:
V.5.ii.C = 507.77 to:

468.11, length of C = length of A
446.97, length of C = length of A + B
464.04 = 38.2% of V.5.i
444.81 = 50.0% (top of earning gap up)
425.57 = 61.8% (start of earning gap up)

If B completes at 511.10:
V.5.ii.C = 511.10 to:

471.44, length of C = length of A
446.97, length of C = length of A + B
464.04 = 38.2% of V.5.i
444.81 = 50.0% (top of earning gap up)
425.57 = 61.8% (start of earning gap up)

• #### roni

Posted: 18 February 2012 10:33 PM #35

lovemyipad - 19 February 2012 02:21 AM

Okay, I’m trying to push through this throbbing pain behind my left eye. :D
Here’s my attempt:

Intermediate degree waves of Primary degree wave V.5 (bright side):
————————————————————————————
Impulse - V.5.i   = \$363.32 to \$526.29, length = \$162.97 = i
Retrace - V.5.ii = \$526.29 to:

V.5.ii.A = 526.29 to 486.63, (approx. 23.6% of V.5.i), length = 39.66
V.5.ii.B = 486.63 to:

506.46 = 50.0% of A (currently at 507.77, so maybe complete), length = 21.14
511.10 = 61.8% of A (higher invalidates current count??), length = 24.47

If B completes at 507.77:
V.5.ii.C = 507.77 to:

468.11, length of C = length of A
446.97, length of C = length of A + B
464.04 = 38.2% of V.5.i
444.81 = 50.0% (top of earning gap up)
425.57 = 61.8% (start of earning gap up)

If B completes at 511.10:
V.5.ii.C = 511.10 to:

471.44, length of C = length of A
446.97, length of C = length of A + B
464.04 = 38.2% of V.5.i
444.81 = 50.0% (top of earning gap up)
425.57 = 61.8% (start of earning gap up)

This is a foreign language

• #### Mav

Posted: 18 February 2012 10:37 PM #36

So confused.

However!  It sounds like an AAPL laugh zone of around 420!

#### Signature

The Summer of AAPL is here.  Enjoy it (responsibly) while it lasts.
AFB Night Owl Teamâ„¢
Thanks, Steve.

Posted: 18 February 2012 10:52 PM #37

This stuff is HARD for those of us without MIT-caliber left brains!! :(  I just barely get it, but I’m trying…

Posted: 18 February 2012 10:56 PM #38

roni - 19 February 2012 02:33 AM

This is a foreign language

+1

My brain really doesn’t naturally work like this.  Which is why I’m not writing the algos…but Mace could!!

• #### Mace

Posted: 19 February 2012 07:12 PM #39

lovemyipad - 19 February 2012 02:56 AM
roni - 19 February 2012 02:33 AM

This is a foreign language

+1

My brain really doesn’t naturally work like this.  Which is why I’m not writing the algos…but Mace could!!

Actually you don’t need to compute anything.  Can just look at the chart, computing is just to aid in communication and have a rough idea of the value.  In a nutshell, EW just postulates five waves for impulse (directional movement) and three waves for corrective (counter-trend movement), and waves are related by fib.  Hardly anything different from what we’ve learned about waves during secondary school (UK system equivalent to high school in US).

So, if EW scares you, can just view it as a three steps forward, two steps backward theory.  The pattern is nested so you need to identify which steps belong to which “nest” similar to coding of nested loops.  If you’re not a programmer, think in terms of box within box.  Each box contains a three steps forward and two steps backward pattern.  One of the hard thing to do is determining the box to which a step belong*.

The problem with casual readers, they like to look at the leaves and wondering what do the leaves tell them.  They should in fact learn what is a forest and jungle, which place have forests and jungles, what would you find in forests and jungles.

Looking at counts to understand EW is totally wrong.  Counts are meant for communication amongst Elliottiicians i.e. someone who understand EW.  Counts are not EW.  Is only a communication tool.

*If you can do this consistently, I’m willing to pay you handsomely for the reading.

[ Edited: 19 February 2012 07:37 PM by Mace ]

#### Signature

Stay Hungry. Stay Foolish.  - Steve Jobs

Posted: 19 February 2012 10:18 PM #40

Mace - 19 February 2012 11:12 PM

Actually you don’t need to compute anything.  Can just look at the chart, computing is just to aid in communication and have a rough idea of the value.

Now you tell me!! :cry:

Mace - 19 February 2012 11:12 PM

Hardly anything different from what we’ve learned about waves during secondary school (UK system equivalent to high school in US).

Ahem, I never understood it then either.

But I do understand: the “three steps forward, two steps back” thing, and the “5,3,5,3,5,A,B,C” box-within-a-box thing.

Mace - 19 February 2012 11:12 PM

The problem with casual readers, they like to look at the leaves and wondering what do the leaves tell them.  They should in fact learn what is a forest and jungle, which place have forests and jungles, what would you find in forests and jungles.

I’m trying!!! :D

Posted: 19 February 2012 10:20 PM #41

Mace - 19 February 2012 11:12 PM

*If you can do this consistently, I’m willing to pay you handsomely for the reading.

That would make it work, not fun.  Blah.

• #### Mace

Posted: 20 February 2012 01:55 PM #42

lovemyipad - 20 February 2012 02:20 AM
Mace - 19 February 2012 11:12 PM

*If you can do this consistently, I’m willing to pay you handsomely for the reading.

That would make it work, not fun.  Blah.

If you can do it consistently, you would be the richest person in short order.  Btw, the post is not meant for you, is for the other guy.

#### Signature

Stay Hungry. Stay Foolish.  - Steve Jobs

• #### Mace

Posted: 21 February 2012 05:35 PM #43

Max pain thesis:  So long AAPL closes above max pain on OE Friday, AAPL is in a multi-month rally. It usually closes nearer to highest OI (calls) when in multi-month rally and nearer to highest OI (puts) when in multi-month decline.

``` Month   Max pain   Highest OI(calls)    Highest OI(puts)Mar 12    \$470          \$500                 \$460Apr 12    \$430          \$565                 \$470May 12    \$445          \$500                 \$400Jul 12    \$420          \$500                 \$400Oct 12    \$450          \$500                 \$440Jan 13    \$380          \$400                 \$250  ```

02/17/12 Max pain = \$455, closed above at \$500.72.  Nearer to HOIC (Mar) of \$500.
01/20/12 Max pain = \$380, closed above at \$420.30.  Nearer to HOIC of \$400.
12/16/11 Max pain = \$385, closed below at \$381.02.  Nearer to HOIP.
11/18/11 Max pain = \$390, closed below at \$374.94.
10/21/11 Max pain = \$390, closed above at \$392.87.
09/16/11 Max pain = \$385, closed above at \$400.50.
08/19/11 Max pain = \$365, closed below at \$356.03.
07/15/11 Max pain = \$345, closed above at \$364.92.

#### Signature

Stay Hungry. Stay Foolish.  - Steve Jobs

Posted: 22 February 2012 09:01 AM #44

Mace, before yesterday, retrace pattern looked to me most similar to “triangle.”  Now I’m wondering if maybe it’s “flat” or “expanded flat”?  (Is this viewing the forest, or am I still hugging a tree? :D)

Common retrace patterns

[ Edited: 22 February 2012 09:29 AM by lovemyipad ]
• #### Mace

Posted: 22 February 2012 12:04 PM #45

lovemyipad - 22 February 2012 01:01 PM

Mace, before yesterday, retrace pattern looked to me most similar to “triangle.”  Now I’m wondering if maybe it’s “flat” or “expanded flat”?  (Is this viewing the forest, or am I still hugging a tree? :D)

Common retrace patterns

The forest/tree thingy wasn’t meant for you.  If it is true that AAPL is in V.5.ii, then the pattern from \$526.29 is a zigzag as follows:

V.5.ii.A   = \$526.29 to \$486.63
V.5.ii.B.a = \$486.63 to \$514.85
V.5.ii.B.b = \$514.85 to ....
V.5.ii.B.c = ... to (would be lower than \$514.85)

Frequently, wave B is a flat or a triangle.

The most comprehensive book on EW is by Neely, “Mastering EW”.  If you want to get a PhD (permanent head damage), this is the book to read.  I use it a reference book, hardly read it.

#### Signature

Stay Hungry. Stay Foolish.  - Steve Jobs