Elliot Wave 1 Day Practical Workshop

By: Trading Point  07-07-2011
Keywords: trading, Forex Trading, Technical Analysis

How The Elliott Wave Principle Can Benefit Your Trading

Most traders have heard of the Elliott Wave Principle and know that it is an advanced technical analysis technique, but what is Elliott Wave exactly ? If I had to sum it up in one sentence, the Elliott Wave Principle is an observation of how markets move when they are travelling with the trend and how they move counter trend. How is this important and how can it help your trading ? There are 5 main areas where the Elliott Wave Principle can improve your trading:

  1. Identifies Movement With The Trend : A 5 wave movement that fulfils the rules and guidelines of an Elliott motive wave, identifies the direction of the trend. This is very important in trading because it will always be more profitable to trade with the trend than against it. Identifying an Elliott motive wave helps you to choose the correct trading direction.


  2. Identifies Countertrend Movements : A 3 wave movement that fulfils the rules and guidelines of an Elliott corrective wave, identifies a counter trend move (pullback within a trend). This is very important in trading because it will always be more profitable to avoid trading against the trend. If you are already in a trade in the correct direction, identifying a mere countertrend / pullback move can help you avoid exiting a trade prematurely and make a larger profit by riding out the trend.


  3. Identifies How Far The Trend Or Counter Trend Movements Have Left To Go : By using the Elliott Wave principle to determine which wave of the trend you are in, you can determine how far the trend has left to go, which in turn can give you a better idea of when to exit a trade or take profit. Conversely, by using the Elliott Wave principle to determine which wave of a counter trend / pullback you are in, you can determine how far the pullback has left to go before the trend resumes. This allows you to prepare for entry into the trend.


  4. Identifies Price Targets For Movements With The Trend And Pullbacks Against It : The Fibonacci sequence is the mathematical basis for the Elliott Wave Principle and both movements with the trend and counter trend movements against it repeatedly unfold in specific Fibonacci proportions. Movements with the trend unfold to characteristic Fibonacci projections for that specific wave and likewise, counter trend movements unfold to characteristic Fibonacci retracements for that specific wave. These high probability price target zones allow traders to more accurately set entry, take profit and exit levels.


  5. Identifies When You Are Wrong About A Trade : The Elliott Wave principle has specific rules and guidelines that govern movements with the trend and counter trend moves against it. A violation of any of these rules will invalidate the Elliott wave count and help you to determine if the trade you are in is still with the trend or if the trend has changed. This can help you exit a trade immediately if you are caught on the wrong side of a trend, therefore helping to minimise losses.

Contact Trading Point about a 1 day seminar where you will learn all the rules and guidelines of the Elliott Wave Principle. You will learn to identify movements with the trend and counter trend / pullbacks against it, as well as the Fibonacci proportions of each wave in order to set high probability price targets for each move. This seminar will help you to trade your current strategy with the trend, and help you to avoid trading corrective movements.

Keywords: Forex Trading, Money Management, Stock Market Education, Technical Analysis, trading

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