Thread: Elliott Wave Trading Discussion

Originally Posted by brad_1199

Oil is going through a short term correction but the steam is building and price is going to sky rocket towards $175 and perhaps even further in the course of this final rally.....

Hi Brad, Amazing Must Appreciate your Technical Analysis.

And So good that You do trade in Commodity.

Originally Posted by apipintime

Hey Mike,

Leading Diagonal (pg. 40 of EWP)

"When diagonal triangles occur in the wave 5 or C position, they take the 3-3-3-3-3 shape that Elliott described. However, it has recently come to light that a variation on this pattern occasionally appears in the wave 1 position of impulses and in the wave A position of zigzags. The characteristic overlapping of waves 1 and 4 and the convergence of boundary lines into a wedge shape remain as in the ending diagonal triangle. However, the subdivisions are different,
tracing out a 5-3-5-3-5 pattern.
The structure of this formation fits the spirit of the Wave Principle in that the five-wave subdivisions in the direction of the larger trend communicate a continuation message as opposed to the "termination" implication of the three-wave subdivisions of the ending diagonal."

I am not quite sure that each of Waves 1,3 and 5 of that supposed Leading Diagonal are standalone impulsive structures, Wave 1 does not look remotely impulsive. So, in my opinion, that looks much more like a B wave than a Leading Diagonal.

In a leading diagonal wave iv enters into the territory of wave i (so called overlap), hence my argument that it is a leading diagonal remains valid, at least IMHO. See the part that I hi-lited in DARK RED and separate line, above.
Plus which, GBP and EUR might differ in details, but they move in principle in unison. Simply speaking, both economies (Europe and the UK, or Swiss, for that matter), are too closely connected; they could not afford HUGE discrepancies.
If GBP moves up, EUR must follow (within reasonable margin)

follow up post 12040 : it look's to me that w:2/b is ready 2 move !?

Oil is going through a short term correction but the steam is building and price is going to sky rocket towards $175 and perhaps even further in the course of this final rally...

Be carefull brad, it might do same trick as YEN crosses just did, meaning landing...

Originally Posted by Big Mike

In a leading diagonal wave iv enters into the territory of wave i (so called overlap), hence my argument that it is a leading diagonal remains valid, at least IMHO. See the part that I hi-lited in DARK RED and separate line, above.
Plus which, GBP and EUR might differ in details, but they move in principle in unison. Simply speaking, both economies (Europe and the UK, or Swiss, for that matter), are too closely connected; they could not afford HUGE discrepancies.
If GBP moves up, EUR must follow (within reasonable margin)

Can you diagram where waves 1,3 and 5 of your supposed Leading Diagonal are standalone 5 wave impulsive structures? Because I don't see it.

The leading diagonal triangle wave. The leading diagonal triangle, or wedge as many call it, is a narrowing price move composed of two converging trendlines occurring in a wave 1 position of impulses or wave A position of zigzags. The chart to the right shows the ideal example without any subwaves highlighted.

Notice that wave 4 overlaps wave 1, just as it does in the ending diagonal triangle pattern. However, the ending diagonal triangle has a 3-3-3-3-3 subwave structure, but the leading diagonal triangle shows a 5-3-5-3-5 pattern. The next chart makes this clear.

Frost and Prechter write,

"The structure of this formation fits the spirit of the Wave Principle in that the five-wave subdivisions of the actionary waves communicate a ’continuation’ message as opposed to the ’termination’ implication of the three-wave subdivisions in the actionary waves of the ending diagonal."

I have no idea what that means, but I couldn’t have said it better myself. They go on to write that Elliott did not discover this pattern, but Frost and Prechter believe it is valid.

About identification, they go on to write,

"The main key to recognizing this pattern is the decided slowing of price change in the fifth subwave relative to the third. By contrast, in developing first and second waves, short term speed typically increases, and breath (i.e., the number of stocks or subindexes participating) often expands."

Rules

The leading diagonal triangle has rules that govern its shape. They are listed here.

* The subwave action usually follows two converging trendlines.
* Subwave four often overlaps subwave 1.
* The subwave count is 5-3-5-3-5.
* The leading diagonal triangle usually occurs as part of wave one of impulses or wave A of zigzags.


The above is the quote from Bulkowski.
Does it clarify the issue? Probably not.
To me, probability of a leading diagonal is high. Risk is limited; once the last C wave down is finished. Reward is high.
Is it a PERFECT leading diagonal? Subwaves 1, 5 are not impulses, but can be construed as motive waves.

Can you diagram where waves 1,3 and 5 of your supposed Leading Diagonal are standalone 5 wave impulsive structures? Because I don't see it.

From the neighbour table just a comment for your thread, leading diagonal do not have any impulse waves, only ending diagonal does - just as Big Mike pinpointed out below.

Hello guys,
Here is my count for EuroAud.
Entered Short at the end of wave 4.
1st tg: 1.7324.
2nd tg: 1.7146.

Edwards,

Originally Posted by Big Mike

Rules

The leading diagonal triangle has rules that govern its shape. They are listed here.

* The subwave action usually follows two converging trendlines.
* Subwave four often overlaps subwave 1.
* The subwave count is 5-3-5-3-5.
* The leading diagonal triangle usually occurs as part of wave one of impulses or wave A of zigzags.


The above is the quote from Bulkowski.
Does it clarify the issue? Probably not.
To me, probability of a leading diagonal is high. Risk is limited; once the last C wave down is finished. Reward is high.
Is it a PERFECT leading diagonal? Subwaves 1, 5 are not impulses, but can be construed as motive waves.

Well, either waves 1 and 5 are impulses(as governed by the rules that make an impulse an impulse) or they are not. From what I can see, they are not impulses, nor do the boundary lines converge, therefore it is highly likely that it is not a Leading Diagonal, and more likely a corrective wave.

Originally Posted by kaori

Can you diagram where waves 1,3 and 5 of your supposed Leading Diagonal are standalone 5 wave impulsive structures? Because I don't see it.

From the neighbour table just a comment for your thread, leading diagonal do not have any impulse waves, only ending diagonal does - just as Big Mike pinpointed out below.

Hi Kaori,

I suggest you take a look at pages 37-41 of the Elliott Wave Principle. Ending Diagonals have a 3-3-3-3-3 structure, while Leading Diagonals have a 5-3-5-3-5 structure. Here is a quote from the book:

Leading Diagonal (pg. 40 of EWP)

"When diagonal triangles occur in the wave 5 or C position, they take the 3-3-3-3-3 shape that Elliott described. However, it has recently come to light that a variation on this pattern occasionally appears in the wave 1 position of impulses and in the wave A position of zigzags. The characteristic overlapping of waves 1 and 4 and the convergence of boundary lines into a wedge shape remain as in the ending diagonal triangle. However, the subdivisions are different, tracing out a 5-3-5-3-5 pattern. The structure of this formation fits the spirit of the Wave Principle in that the five-wave subdivisions in the direction of the larger trend communicate a continuation message as opposed to the "termination" implication of the three-wave subdivisions of the ending diagonal."

Ending Diagonal (pg 37 Elliott Wave Principle)

"Ending diagonals take a wedge shape within two converging lines, with each subwave, including waves 1,3 and 5, subdividing into a "three", which is otherwise a corrective wave phenomenon."

Well Apinitime. In real life those 3´s are not so clear, or not actually how do I track them. When speaking about diagonal, it´s most often fifth wave position meaning ending the direction for current direction & reversal pattern and one of my favorite pattern also. I rather looking it as ending impulse. So, propably technically correct name is leading diagonal, but because it´s actually ENDING current direction, not leading it anywhere anymore so I often call it for ending diagonal

Perhaps some example from near future in here ?

>>>>>MARKET GEOMETRY<<<<<

Here's a look at what I think is occurring with Swissy:

It's unclear wether or not a major top is in place for gold yet... But I must favour further gains for the time being....

Originally Posted by apipintime

Here's a look at what I think is occurring with Swissy:

I don't have a solid count for Swissy either, but "look" wise, this small wave A and huge wave B scenario is kinda stretchy don't you think?

As much as I want this pair to rebound up from here to at least 1.38~1.48 area, there's still a fair possibility that it will take one more dive to around parity in the short term.