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Thursday, August 30, 2012

Elliott Wave Analysis of EUR/JPY

Potentially this still looks unfinished as we need to see 7 swings for a WXY correction (abcxabc)

If the small wave [b] is in place we should see a push higher now as this is finishing the last wave of a suspected double Zig Zag correction

If the current move is a small b wave of wave [b] then a trip to 97.50 should be seen before a resumption higher

Only a strong break of 97 would this idea start to look wrong, but while it suggests higher prices the market must be given respect and i am looking for a potential target around 100.50

As always things change and we must adapt as price changes but for now this is the preferred wave count going forward

Wednesday, August 29, 2012

Elliott Wave Analysis of EUR/AUD

It appears to have ended a 3rd wave, so a pullback now should see the 1.200 area for wave [iv]

From there i am looking for a new high to end a 5 wave sequence from 1.1607

Its not a pair i follow, but if you notice if could be a good cue for the AUDUSD pair, which is a pair i follow every day

Elliott Wave Analysis of EURO STOXX 50

Following on from my last posting on Twitter, the market has indeed rallied as i expected it would, (after a 5 wave decline).

What i am looking for is a 3 wave bounce to correct this 5 wave decline, as that would offer a great selling opportunity to sell with controlled risk at the last swing high at 2494

So a move towards 2470 would be idea and align with some other markets, especially the US markets with a new yearly highs for some ideas we are working

Tuesday, August 28, 2012

Elliott Wave Analysis of Corn

From my last update on Corn, the market did pullback but not in the way i expected it would for the last idea


It seems looking at the U2 contract it has morphed into a potential triangle, although the risk presently is contained to the wave [c] lows (blue lines), so a thrust high needed for wave [v]

I am reluctant to label the move completed as i would have expected to see a move that was more aggressive that we have seen so far

A strong break under the blue line will negate this idea

Monday, August 27, 2012

Elliott Wave Analysis of EUR/USD

The advance from the 25th July lows has likely morphed into a double ZZ although i am watching for an equally valid wave count (labeled alternative)

The overall look suggests the advance should still see 127-12750 before a resumption lower, although with the Jackson Hole meeting this week, there is many markets waiting on the direction from the FED.

Sunday, August 26, 2012

Elliott Wave Analysis of Gold

An update to my last post on Gold, and it seems we do have a date with the $1680 area

Whoever controls that area IMO should have the edge over the larger trends.

The bulls need to continue higher and really show their dominance of this market.

The bears need to defend $1680 and force the sellers back into the markets, so $1680 should setup a clear edge to a directional move (allow for some wiggle room of a few $)

You can see that its right on top of the measured target, and we appear to have some smaller gyrations left, so it will be an interesting week, with the Jackson hole meeting in a few days, its clear IMO that the bulls are anticipating more QE

I am using the popular ETF GLD to represent the price of Gold but its esentialy the same as the spot price

Elliott Wave Analysis of Silver

With the explosive moves in Gold and Silver, it looks like a good opportunity to post a potential set up on Silver.

I am using a very popular ETF to represent Silver as many traders don't have access to the big Silver contract such as SI, but that aside its essentially the same as Silver, only its paper trading.

The key point i want to make is that i personally still think this is a 3 wave move much like the move in Gold, although this may morph into something far more bullish, staying below $30.80-31 on Silver and $1680-1700 on Gold is potentially a cluster of resistance that could be more important than traders realise.

Whoever controls those price areas likely decides the next serious move, up or down.

The bulls in Gold and Silver need to follow through with this move, the bears need to see a strong reversal

So it looks like the Jackson Hole meeting could be the decider and confirm the trends.

I strongly suggest watching for a reaction from the $30.80 area on Silver, its a big area and IMO will decide the larger trend.

Tuesday, August 21, 2012

Elliott Wave Analysis of Gold

The break higher in Gold has broke the triangle idea that many Elliotticians were following, although there is an alternative idea that we have been following

Personally i see nothing bullish in the price action on the larger time frame, although we switched to this idea a few days back, due to the lack of downside needed for the triangle idea, which never came

This potentially could rally to $1680 from here, but the minimum requirements have been achieved. (a break above $1641)

A strong break above $1680 needs respecting if your bearish on Gold, but whilst this idea continues to be in the frame, i wont take the breakout that seriously atm.

The advance still supports that of a corrective sequence of waves, lots of overlap and when you look at it from a distance its got a 3 wave look to it, which supports the case that's a corrective wave.

Edit - I got asked why i don't think its a bullish move, well short term it almost certainly is a bullish move as its a break out above $1641, but on a daily perspective whilst its below $1680 i suspect this move is a 3 wave bounce of a larger move on the daily time frame

Its all relative to the traders time frame, whilst traders are bullish on a 60 min chart, its below the 200 DMA and IMO it looks like a bunch of 3 waves moves

3 wave moves are key as it lets up know the likely hood that the move is a corrective sequence of waves as opposed to an impulsive move which is made up of a series of 5 wave moves followed by 3 wave corrections

I don't see a 5 wave move so i am unable to convince myself that the move is an impulse wave, however i would respect a strong break out above $1680

Sunday, August 19, 2012

Elliott Wave Analysis of SENSEX

The SENSEX is now coming into areas of interest and i think the bulls need to be on guard as a potential reversal could be near.

We know that this market follows the AUDUSD and HG markets closely and potentially both NG and AUUSD could be close to a move lower, its something i am tracking on those 2 markets for members, although i don't track the SENSEX nor the other Indian markets, i keep an interest in other markets so see if they offer a clue

Wednesday, August 15, 2012

Elliott Wave Analysis of DOW

The advance from the June lows has taken on a slightly different set of waves depending on which market you look at, as the DOW has an overlap on the last series of waves where as the other markets such as the SPX does not possess that overlap (as shown)

Considering that the DOW is the easy market to run higher, i don't think its a bullish sign when you have sloppy price action on the leader of the pack at the highs

The bulls seldom appear to forget this important clue when it comes to be truthful to what is happening in the markets, the DOW is showing some sign of weakness against other markets

Because of the overlap we can label the advance as an ending diagonal (wedge to non Elliotticians) as we have an overlap between waves 1 and 4 which is a requirement for an ending diagonal

If this is the correct interpretation then it should be on the verge of a complete reversal and retrace all of the rally from the June lows

Saturday, August 11, 2012

Elliott Wave Analysis of EUR/USD

I thought readers might be interested in an update to this pair

A couple of weeks back i wrote a post suggesting that we should see a decent bounce, or something to correct the 5 wave decline from 12741


So as a reminder to those that don't know, after every 5 wave move we should see a correction in 3 waves, that's the simplest form of Elliott Wave

If we fast forward, we have a 3 wave bounce as expected and potentially the start of something more stronger, although we will only will know the true extent of the move as we monitor the waves, but we can use wave structure to control risk and monitor the ideas.

I have included in an alternative wave count, that's not to say i don't have faith in my ideas, far from it, but there is the potential to morph on corrections and we might see only a 3 wave bounce from 12440 and then push to 125 (that idea comes from an idea on the GBPUSD)

The EURUSD pair is anything but a friendly pair when it comes to corrections, but i still think if the high is not in on this pair, then regardless if we see a dip then higher, IMO we are likely going to see lower prices on the EURUSD over the coming weeks/months

The bounce has likely neutralised the bearish sentiment, but its a 3 wave bounce and the odds suggest that if its not all of the correction then being part of a correction still suggests lower prices only it will waste time as it did on the prior correction around the 12320 area before heading lower in wave [v] from 12741

From the last swing high it appears to be a 5 wave decline, so a 3 wave bounce is a setup against the last swing high (red line) we have risk control

Target - open based on any subsequent decline

5 waves to the downside and 3 waves to the upside is a trend that wants to go lower

If you look at the fractal chart do you notice how the bounce is pretty much the same as the prior blue fractal a bit higher up, by using the history of the corrections we can find price windows and hone down that using the Elliott Wave principle.

Friday, August 10, 2012

Elliott Wave Analysis of Corn

Is this rally finally finished?, having hit a target at $8.43. There looks to be a clean idea now on Corn

The bit the bears are missing is the reversal, but thats a clean example of a 5 wave advance i ever did see

Thats virtually text book for a 5 wave move.

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Thursday, August 9, 2012

Elliott Wave Analysis of AUD/CAD

In the midst of the chop, we appear to finally have a decent 5 wave decline and a 3 wave bounce (currently corrective looking) so any bounce that stays under the prior swing high at 1.0597 is a setup to sell

Target - open as there is a few options, so based on any subsequent decline would tell us going forward

Saturday, August 4, 2012

Elliott Wave Corrections

Corrections in Elliott Wave tend to cause the most problems, counting a 5 wave move is pretty easy to most traders, but where traders run into issues is corrections.

The rally from the June lows has been a very complex and difficult move to count let alone trade
There are many types of corrections but it simply comes down to 3 set ups based on the number of waves

ABC = 3 waves

WXY = 7 waves (ABCXABC)


So if you count the number of waves from the June lows ask yourself the question.

How many waves do you see?

Is it impulsive looking or corrective looking?

Do you see 5 non overlapping waves as part of an impulse wave or loads of overlapping waves?

If you can answer those questions then you are well on your way to making some important choices about the next likely direction in both the AUDUSD and SPX

Elliott Wave Analysis of EUR/JPY

Following on from the last post: http://wavepatterntraders.blogspot.com/2012/07/elliott-wave-analysis-of-eurjpy-eurusd.html

This turned out really well and held the key support line and i suspect it could still see a bit higher.

The basis in an Elliott Wave sequence is that after every 5 wave move we should at min see a 3 wave correction

There are many potential targets and one such targets is back to the 4th wave of the prior trend in this case around 97.30 which it has met.

Another such target would be the 50% or 61.8% retrace, so those are a little bit higher between 98.00 and 99.00

We can also watch a fibbo target where 2 the legs [a] & [c] would be equal to each other around

98.11, so it seems the 98.00 is in focus

We can also watch the very short term labeling for wave [c] and watch for a 5 wave completed move

Elliott wave can be used on many time frames, Now i am showing the advance as a simple ABC advance/correction against the 5 wave decline from 101.62, it maybe something stronger, but the minimum idea was a 3 wave advance, if it morphs into something else we can deal with that if the situation arises

But the min targets are coming into focus

Elliott Wave Analysis of AAPL

The advance from the lows at $565 looks to be ending a potential 5 wave rally. However what is that rally part of? If you know the answer to that, you should have 2 important decisions to make:

1) The direction of the next large move in AAPL

2) The direction of the next large move in the NDX

Most traders should be aware of the close relationship between AAPL and the NDX, so its important to follow AAPL as it has such an important effect due to the weighting in the NDX

If you want to follow the next likely outcome, then come and join us, we cant make promises but you have a game plan to take with you going forward, and most importantly what we are expecting and where the idea looks wrong