Elliott Wave Principle Applied To The Foreign Exchange Markets


  • Format: PDF
  • Pages: 93
  • Published Date: 1989


The Elliott Wave Principle is exactly that, a principle, but it does endeavour to place the overall market move as well as the short-term wave structure into an order. The primary objective is to establish the presence of the most destructive and thereby the most profitable wave formations, be they a 3rd Wave or a C Wave. The application of the Principle is not infallible but when its applied correctly it is overpowering in its market interpretation as well as its success. Above a 11 the Principle accepts implicitly the technical chart patterns used by other systems whether terminal or consolidatory. It is not an alternative, but it places chart formations suck as a Head and Shoulders structure into a larger order of events and a wider perspective.


The book is divided into eight parts. Part 1 is a general introduction to Elliot Wave analysis and the foreign exchange markets. It outlines the difficulties and possibilities inherent in wave analysis. A brief background is provided. Part 2 describes thefundamental concepts of Elliott Wave Analysis. The basic patterns, and their more common variations, are provided in easy-to-compare illustrations. Provided too, are the most common pattern combinations fow1d by the author in real-time analysis over the past twelve years.

Part 3 is devoted entirely to deviations from the normal wave relationships, both in terms of ratio, and in form. Examples of substitution of simple patterns by complex ones are also shown in never-beforepublished illustrations. Part 4 outlines the most common practical guidelines and other observations that should be of value to anyone who is just starting out on wave analysis. Even veteran wave analysts may find the insights provided in this extensive body of tips and comments useful and informative.

Part 5 also provides practical tips to the wave analyst who finds the going rough, especially when he or shea is stuck with multiple senarios and has trouble defining the options available. Part 6 outlines a typical Elliott Wave Trading Plan from lhe inilial stages of the traditional five-wave sequence. through its final corrective stages, illustrating various optimal trading strategies. Part 7 provides real examples of trading situations written by the author. Daily comments have been assembled into case studies which can be applied for future events. Part 8 concludes with some insights into the future of wave analysis, including the study of chaos and disorder, the application of fractals and recursive patterns, and othr recent works on non-linear dynamics.


  • Introduction
  • The fundamental concepts
  • Deviations
  • Guidelines and other observations
  • Practical guidance
  • A typical Elliott Wave trading plan
  • Case studies
  • Conclusion