Elliott Wave Principle: Complexity and Usefulness

This article is a side note from Laszlo’s most recent post: From Dow to Broccoli

For someone exploring the Elliott Wave Principle for the first time, a typical response would be comments related to its complexity.
Some say learning and applying the Wave Principle is too difficult – so why even bother. But:

“Those who neglect to study the subject thoroughly or apply the tools rigorously give up before really trying. The best learning procedure is to keep an hourly chart and try to fit all the wiggles into Elliott wave patterns while keeping an open mind for all the possibilities. Slowly the scales should drop from your eyes, and you will be continually amazed at what you see.

“After you have acquired an Elliott ‘touch,’ it will be forever with you, just as a child who learns to ride a bicycle never forgets. Thereafter, catching a turn becomes a fairly common experience and not really too difficult.”Elliott Wave Principle – Key to Market Behavior, Frost and Prechter, pp. 92 & 94

Isn’t being able to understand market trends and catch turns worth some studying?

Nonetheless, let’s address this concern over complexity – and I mean, the real objection, not the “I just don’t believe in that stuff” thinking.

Consider the extensive knowledge needed to successfully send a man to the moon and back. Complex? You bet. Yet it’s required to get the job done. Natural law permits nothing less: No shortcuts, regardless of complexity.

So it is with the Wave Principle as applied to financial markets. Patterns in price charts are also based on natural law, that of progress and regress; understanding their complexity is required if you want success.

The good news, if you are not so inclined to learn all about the Principle but want to employ it in your investments anyway, we stand ready to help. We’ve used Elliott for over 35 years – quite a long time. While you will get more out of it if you actually learn the method, we can do much of the heavy lifting for you. Click here to start using EWI’s knowledge today, risk-free.

The time zone we reference on our charts is Pacific Standard Time. Therefore, the U.S. cash market opens at 6:30 AM PST and closes at 1:00 PM PST.

About EWI

Founded in 1979 by Robert R. Prechter Jr., Elliott Wave International (EWI) is the world's largest market forecasting firm. Its staff of full-time analysts provides 24-hour-a-day market analysis to institutional and private investors around the world.

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