Elliott wave theory enjoys massive popularity. It was described as the best technical analysis by many brokers and publishers.
Elliott wave theory is a huge and devoted.This theory has a basis of sound logic, which can help you make money!
Let’s look at the Elliott wave theory in more detail, and then look for a reasonable analysis of the market.
The theory was named after Ralph Nelson Elliott, who concluded in his book “The nature of law” that the movement of financial markets can be predicted by observing and identifying repeating patterns of waves.
Elliott’s profound observation
Elliott came to a stunning conclusion that all natural phenomena are cyclical and that includes the financial markets. That’s true, but we know that in any case – we know that at some time in our lives, we feel like rain when we venture outside, the question of when exactly?
Thus, markets are cyclical – Big deal! What we want from the investment theory is the probability of the event – that is, when it is most likely.
Elliott Wave Theory is an objective theory of investment, but there is no objectivity in it!
It’s all subjective interpretation of the peaks and troughs, at any time you like!
Does this sound logical intellectual theory to you?
Theory
Based on the rhythms found in nature, theory suggests that the market is moving upward in a series of five waves and down in a series of three waves.
The difference between the Elliott Wave principles and other cyclical theories is that the theory suggests, there is no absolute requirement for full-time – Well, that’s great help!
Subjectivity is so high in the Elliott Wave, which, like most theories, everything is explainable in hindsight, but in reality the difficulty of predicting the future.
There are so many interpretations of the actual peaks and valleys at different times that everyone will see them differently; this is hardly the basis of predictive theory.
Elliott Wave Theory says that it is able to predict the market, but did not give an objective opportunity to do so in practice.
Who uses the Elliott Wave Theory?
1. Investors who want an easy way to earn money, and attracted to the mysticism of tools such as the number of the Fibonacci sequence, to predict market recovery.
2. Investors who believe in the false assumption that you can predict the behavior of the market in advance – and want an easy way to earn money.
What markets really Move
Market prices is a reflection of the following:
Supply and demand fundamentals of human psychology + = price action
It seems simple, but in reality a complex equation – which can not be predicted in advance.
Retail markets with the help of technical analysis to put all the odds and probability in your favor, and nothing more. This is not a way to predict the future.
Are there more effective than the theory of Elliott wave around to make money from the markets? – Good exercise was to interview all the best performing fund managers in the world and see how many of them take the theory seriously.
Intelligent and subjectivity not mix!
The theory of Elliott wave theory is predictive, which leaves all the subjective analysis.
If Elliott has developed a theory of intellectual, why not give an objective way to make money from it? – As with most predictive theory is not working.
If investors can predict the market in advance, we would all know what would happen – and there is virtually no market at all, as we all know the market price in advance!
Elliott Wave Theory should be the intellectual theory, but the only thing that can be predicted with him, so you will lose money.
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