suriNotes Newsletter (Free)


  Trading Elliott Wave with ABC     07/29/2010 4.45pm


Many years ago, I got interested in developing EW program for TradeStation and I learnt for few months of its build, various rules and its nuances. Coding was a new challenge as it constantly adjusts and re-adjusts with various arcane rules. This process took about 6 months for me to understand and code various rules, but finally realized I may never be able to completely write the EW algorithm to my satisfaction. Hence, I abandoned the EW project but I learnt quite a few patterns in the process. Even though I do not look for EW actively, time to time, I do find the EW waves and I trade them from ABC perspective. Today was such a day in ES 1220 Tick chart... Here is how it worked out as I initially traded only ABC pattern.

Today ES Sold off from the high of 1112.5 to 1088 by noon. Most serious drops have some retracements as Counter Trend moves. The first bounce from low was at 1088 to 1094 area (6 pts) signaling potential AB leg in the ABC pattern. The retracement (BC) leg was about 4 points to 1090 area with 76% AB length. See EW01 figure. Note Pivot (A) was also marked as 'Market Structure Low'. Having (A) or (B) or (C) as Market Structures adds additional confirmation for the ABC Pattern. The entry trigger into the ABC was at 1092.75 with targets between 1095.25 and 1096.75. A Stop loss is set at 1090 level (C). Once the AB reached its targets (See Fig. EW03), I was thinking it may see its reversal at 1.62AB level (1098.5). Then it also occured to me that this may be an Elliott Wave pattern with Wave3 (start at 1090 and ending at 1098.5).

Around 1.30pm ES reached its 1.62AB Target (1098.5) and start to reverse. Now, for EW to continue its formation, the 4th wave should end above 1094 level (B). About 2.11pm, the 4th Wave formed just above (B). See EW5 image. Now EW should form 5th wave from 1094.5 level to (1102.75-1104.25 which is 76-100% of Wave3 range. See EW06 image.

The obvious question is what next? Once Elliott Wave completes its 5-wave, it is supposed to reverse and form A, B, C waves and retest the high of 1 low of wave 4 to form Elliott Wave downwards.

Elliott Wave using ABC Bullish Pattern



Tools
1. Auto ABC
2. Fib. Bands
  Books/Poster
     Trade Chart Patterns Like The Pro (Book)
     Trade Chartmuster wie die Profis (Book)
     Trade Chart Patterns (Poster)
  Indicators
      Auto ABC
      Market Structures
      2BTop/Bottom
      TrailStops
      EquiVolume
      Combined Market Internals
      eSix
      SuperBars
      Fib.Zones
      Fib.Bands
      Volatility Zones
      GapCharts
  Patterns
      Today's Posts
      ABC Bullish
      ABC Bearish
      AB=CD
      Gartleys (5-Point patterns)
      Head and Shoulders
      Inv. Head and Shoulders
      Cup and Handles
      Parabolic Arcs
      MegaPhones
      Channels
      Flags/Pennants
      Triangles
      2B Top and Bottom
      Double Top and Bottom
      Dragons
      Market Structures
  Blog Posts
      Trading Bearish Shark Patterns
      Trading ABC Bearish Patterns
      Trading Head and Shoulders Reversals
      Trading Rectangle Channel Patterns
      Patterns within Patterns
      Trading Symmetric Triangle Patterns
      Trading Cup and Handle Patterns
      Trading Megaphone Patterns
      How to trade your Dragon
      Trading ABC Patterns
      Parabolic Arc: What Goes Up...
      Trading Large Gaps
      Trading Parabolic Arcs
      Behavioral Biases
      Trading Chart Patterns Prematurely
      Developing SPX Cup and Handle Pattern
      Trading Patterns with Market Context an
      Trading Patterns with Market Structures
      Trading Failed Chart Patterns - H&S
      Happy New Year 2016
  Blog Categories
      2B Patterns
      ABC Bullish
      ABC Bearish
      Books
      CMI
      Double Bottom
      Double Top
      Dragons
      Elliott Waves
      Failed Chart Patterns
      Fib. Bands
      Fib. Zone Pivots
      Fibonacci Levels
      Floor Pivots
      Gartley/Butterfly
      Globex Pivots
      Head and Shoulders
      Inv. Head and Shoulders
      Market Structures
      MegaPhone
      Multiple Tops
      Multiple Bottoms
      Options
      Parabolic Arc
      Pivots
      Price Profile
      Seminars
      Strategies
      SuperBars
      Triangles
      Trading
      Psychology
      Videos
      Volatility Zones
      VWAP
      Wolfe Waves
      X5 Patterns
  Combo Package Offers
      ABCPack1
      ABCPack2
      ABCPack3
      ABCPack4
      ABCPack5
      ABCPack6

Copyright © 2008-2017, suriNotes.com, All Rights Reserved ®


FULL Disclaimer/Terms & Conditions

DISCLAIMER: THE RISK OF LOSS IN INVESTING STOCKS, FUTURES, OPTIONS, FOREX OR COMMODITIES CAN BE SUBSTANTIAL. YOU SHOULD THEREFORE CAREFULLY CONSIDER WHETHER SUCH INVESTMENTS ARE SUITABLE FOR YOU IN LIGHT OF YOUR FINANCIAL CONDITION, YOUR INVESTMENT EXPERIENCE AND OBJECTIVES, FINANCIAL RESOURCES AND OTHER RELEVANT CIRCUMSTANCES. PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS, AND LOSSES ARE ALWAYS POSSIBLE. THE STRATEGIES OR TRADE SETUPS MENTIONED HEREIN SHOULD NOT BE CONSTRUED AS CONSERVATIVE STRATEGIES BUT RATHER SPECULATIVE AND FOR SHORT-TERM TRADING PURPOSES ONLY. THERE IS EQUAL OR GREATER POTENTIAL FOR LOSS WHILE USING THIS STRATEGY AND TRADE SETUPS.

All information, graphs and depictions represented in this site are OPINIONS and HYPOTHETICAL PERFORMANCE RESULTS and should be recognized as such and are not solicitations or instructions to execute orders. You shall be responsible for any decision to purchase and/or sell any of the futures products depicted herein. The owner of this site makes this material available to the public but assumes absolutely no responsibility or liability. The website contains links to other websites. These links are provided as references to identify and locate other internet resources that may be of interest. These other websites were developed by parties independent of the owner of this site and as such the owner does not assume responsibility for the accuracy or appropriateness of the information contained at, or endorse the viewpoints expressed at, such websites. Copying with intent to redistribute any part of this website is expressly prohibited without prior written consent and is and punishable under United States copyright law. All rights reserved.