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Starting the Counts
07-10-2017, 06:23 PM (This post was last modified: 07-10-2017 06:25 PM by sragone.)
Post: #1
Starting the Counts
Hello,

I’m not exactly new to Elliott Wave, but I do consider myself a beginner. I have read many books and have seen various authors’ take on proper labeling of charts. I’ve even taken several courses at Elliott Wave International (EWI from now on). However, every time I look at the charts, it seems like I’m trying to trade on ever changing cloud shapes. What do I mean by “cloud shapes”? If you have two people standing outside on a sunny day looking at a cloud bank and one person sees a “lion” and the other sees a “bear”, then whose right (of course in that instance does it really matter)? I’m using this analogy, because when I look at the various Elliott Wave counts on a price chart, there seems to be various logical conclusions (and seemly valid reasons) why every count might be considered correct.

The main point of this post is simply… Is there a correct way to take a blank chart and in a methodical step-by-step fashion, create an immutable count? I’ve heard the various bits of advice in the past – “Start from the Top -> Down”, “Look for a pattern you recognize”, etc.…. Despite “knowing” the correct way to attack the charts, I look at a chart and I’m still getting hopelessly lost in creating the proper counts.

Now I can look and see Zig-Zags and some ‘N’ shaped structures which I guess I can call flats, within a chart, but that raises a question for me… Would chart labeling be best served by going from the inside out and adjusting the degrees when necessary, or from the outside in (Top -> Down) approach?

In conclusion, does there really exist an approach whereby you could simply follow it and say:
1. Do this first and look for that…
2. Do this next and look for that…
3. Etc.
until you can create a definitive wave count?

Thank you time and consideration.
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07-12-2017, 09:11 AM
Post: #2
RE: Starting the Counts
(07-10-2017 06:23 PM)sragone Wrote:  Hello,

I’m not exactly new to Elliott Wave, but I do consider myself a beginner. I have read many books and have seen various authors’ take on proper labeling of charts. I’ve even taken several courses at Elliott Wave International (EWI from now on). However, every time I look at the charts, it seems like I’m trying to trade on ever changing cloud shapes. What do I mean by “cloud shapes”? If you have two people standing outside on a sunny day looking at a cloud bank and one person sees a “lion” and the other sees a “bear”, then whose right (of course in that instance does it really matter)? I’m using this analogy, because when I look at the various Elliott Wave counts on a price chart, there seems to be various logical conclusions (and seemly valid reasons) why every count might be considered correct.

The main point of this post is simply… Is there a correct way to take a blank chart and in a methodical step-by-step fashion, create an immutable count? I’ve heard the various bits of advice in the past – “Start from the Top -> Down”, “Look for a pattern you recognize”, etc.…. Despite “knowing” the correct way to attack the charts, I look at a chart and I’m still getting hopelessly lost in creating the proper counts.

Now I can look and see Zig-Zags and some ‘N’ shaped structures which I guess I can call flats, within a chart, but that raises a question for me… Would chart labeling be best served by going from the inside out and adjusting the degrees when necessary, or from the outside in (Top -> Down) approach?

In conclusion, does there really exist an approach whereby you could simply follow it and say:
1. Do this first and look for that…
2. Do this next and look for that…
3. Etc.
until you can create a definitive wave count?

Thank you time and consideration.

Hi sragone,

LOL! One does not need to describe the differences in "interpretation" among us
EW'ers. This is all too common and it's not just you.

As my book suggests you should dispense with shapes and geometry.

In addition one likely cannot render a definitive count at just one degree unless
you're perfect. It validates and proves itself. It does this by having a higher degree
correct and a lower degree correct.

Our biggest shortcoming is counting casually. This usually begins as soon as you've
counted 1, 2 and I'm NOT kidding!

What you may be labeling 1, 2 may be 1,2,3,A,RTB,C and what follows that will be
the rest of the nested 4th waves of the (5th or C) that you are REALLY in. That has
huge import since you usually can identify 5 or 6 nestings before the terminus and
the legal travel is substantial.

You definitely can benefit from looking at a top down view in order to assess the
market condition. If you look at the Weekly chart and see inside moves of inside
moves giving a generally sideways movement you should realize what you are
looking at.

Such a sight should have you KNOWING that this is evidence of either nested 4th
waves and you will be applying some frequent application of NEWR in there or a
normal consolidation and early development of the next motive subwave. It's your
job to KNOW which one.

If you see a long drawn out ranging trend at about 45 degrees you should KNOW
that only an A-B-C of the [b] of an RTB 4th of either a 5th or C will look like that and
now you are knee deep in NEWR.

Then, getting back to casual counts, there are speed changes. Every strong and
long move is not necessarily a 3, OK? No, what every wave actually IS is what it is
supposed to be by rule. Also because of speed changes every A-B-C of the [b] of an
RTB 4th of either a 5th or C, as described in the last paragraph, will not
necessarily trend at about 45 degrees.

What do you do first? You would want to be thoroughly aware of the rules and legal
travel of each wave. You must know that when you have proven the count at any
local stage the higher and lower degree from there will not violate each other.

Why not prove every lower degree that you can get detail on.

If you know the rules you will know what wave MUST follow the last and at what
degree it MUST be.

EWI will not be something you can depend on at all times because they do not apply
NEWR and they use the extra (non-existent) letters and consider extension
workarounds such as double-threes and so forth. No the RTB in the 4th of a 5 or C is
a rule because it happens every time and when you apply it then you see that there
is no such thing as a double three or any other letters above the C - only 12345ABC.

They must be having some fun over there. Their fame originated from a Supercycle
degree motive wave which would throw you off only so often and you always have
the extension to blame. Also their approach is that what the waves cannot do versus
what they will do is sometimes all you can know and you need to have an alternate
count in your back pocket.

But as they discovered we are NOT in Kansas anymore.

It sounds like you want to have a definitive count and that's to be respected and
applauded. Get ready to make mistakes and work hard because the market has
innumerable permutations even though it never breaks the rules.

Enjoy the ride.

Smile

TS Hennessy
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07-13-2017, 02:12 PM
Post: #3
RE: Starting the Counts
(07-12-2017 09:11 AM)TS Hennessy Wrote:  EWI will not be something you can depend on at all times because they do not apply
NEWR and they use the extra (non-existent) letters and consider extension
workarounds such as double-threes and so forth. No the RTB in the 4th of a 5 or C is
a rule because it happens every time and when you apply it then you see that there
is no such thing as a double three or any other letters above the C - only 12345ABC.

They must be having some fun over there. Their fame originated from a Supercycle
degree motive wave which would throw you off only so often and you always have
the extension to blame. Also their approach is that what the waves cannot do versus
what they will do is sometimes all you can know and you need to have an alternate
count in your back pocket.

Thanks for your response. This is one of the reasons for the post. Alternative counts drive me absolutely nuts, particularly when the result is a price forecast in the opposite direction of the primary count.

Looking at your response, is it then correct to state that the complex corrective counts are nonsense? I've always held that the W-X-Y and the W-X-Y-X2-Z were basically "glue points" that assembled various corrective structures in the 4th waves.

Another thing, my reading of the new rule is that you'll find the 4th wave in waves 5 and C to be flats. Correct? If that's the case then two things come to mind...

1. Will the B wave usually terminate at the 138% of wave A?
2. What usually happens with the 4th waves inside of waves 1, 3, and A?

On page 31 of your e-book (the 5 min GBP/JPY) it looks like wave iv terminates beyond the end of wave i. Even if we're getting rid of the shapes that were in Prechter's book, can we still call this an "ending diagonal"?

The last question of this reply is that I've held that Elliott Waves are counted in a 1-2-3-4-5-A-B-C, but would it also be correct to view that you may also have 1-2-3-4-5-1-2-3-4-5 in other words, one impulse followed by another without the A-B-C correction?

Finally, I'll tell you what... I'll be willing to suspend what I've been taught in the past and take an honest look at this method. There will probably be many more questions to follow.

Shane
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08-01-2017, 12:07 PM
Post: #4
RE: Starting the Counts
(07-13-2017 02:12 PM)sragone Wrote:  Thanks for your response. This is one of the reasons for the post. Alternative counts drive me absolutely nuts, particularly when the result is a price forecast in the opposite direction of the primary count.

Looking at your response, is it then correct to state that the complex corrective counts are nonsense?

Corrective counts are always complex since it is the digestion of competing interests
which then gives rise to indecision and speculation. But reading in that you refer to
all the different letters beyond C and double-this and that, yes they are nonsense if
they do not exist and NEWR states flat out they do not.


Quote:I've always held that the W-X-Y and the W-X-Y-X2-Z were basically "glue points" that assembled various corrective structures in the 4th waves.

Another thing, my reading of the new rule is that you'll find the 4th wave in waves 5 and C to be flats. Correct?

No that is not always the case and less often would it be when counted with all its
parts. There is considerable variation and legal travel which typically gets explored
with much enthusiasm until most extremes (i.e. Stops) get tripped.


Quote: If that's the case then two things come to mind...

1. Will the B wave usually terminate at the 138% of wave A?

No correlation exists except pure wave structure. Given that there are frequent
speed changes which can elongate any move yet still keep that pure structure
Fibonacci extensions become a crap shoot.


Quote:2. What usually happens with the 4th waves inside of waves 1, 3, and A?

These act as standard EW (without the extras NEWR invalidates). In other words these
will be a Zig-zag A-B-C (in which the subwaves of that C will have an RTB 4th).


Quote:On page 31 of your e-book (the 5 min GBP/JPY) it looks like wave iv terminates beyond the end of wave i.

Given that this is a Forex chart which is a leveraged instrument it is even allowed by
Prechter. Yet in reality this is legal travel in all cases or instruments and not just in
RTB 4th waves.

When wrong counting related to not knowing about NEWR and the workarounds from
misidentifying what were thought to be extensions got combined with rules formation
during a Supercycle MOTIVE section of a Grand Supercycle wave that also had lack of
detail availability the conclusion that wave 4 cannot impinge on wave 1 territory was
made however it was only what was happening in a powerfully bullish situation and
observed from a birdseye perspective.

Current wave action shows that this can and does occur regularly. It may not if
market sentiment leans otherwise but the legal travel is there.


Quote:Even if we're getting rid of the shapes that were in Prechter's book, can we still call this an "ending diagonal"?

It can be called anything you like. Smile

Better though to understand what that nomenclature suggests and why. The
underlying importance is that there will be speed and scale changes at reversals. A
leading diagonal as the term is used among wavers is an example of nothing other
than speed or degree change.

This can occur by the narrowing price travel of nested RTB 4THs subwaves which
then give rise to the C which will be at a higher degree. Or it may be the final
terminus of any wave's 5th that unfolded with less vigor and more tension.


Quote:The last question of this reply is that I've held that Elliott Waves are counted in a 1-2-3-4-5-A-B-C, but would it also be correct to view that you may also have 1-2-3-4-5-1-2-3-4-5 in other words, one impulse followed by another without the A-B-C correction?

Yes that is a regular occurrence in appearance but not actuality in the way you
describe it. Let me explain with scenarios where motives follow motives.

In any 5th or C:
When the (3) wave is finished you get an (a) of the RTB (4). That is a Motive
following a Motive. The (b) which follows will begin with an A wave and again that is
a Motive following a Motive.

In 1 and 3:
When (1) or (3) complete you get an (a) of (2) or (4) respectively. That is a Motive
following a Motive. The (b) which follows will begin with an A wave and again that is
a Motive following a Motive.

Yet in all cases the rest of the development will complete with the remaining portion
of the A-B-C structure.

These are all demonstrating the same aspect which is Degree Change.

The only thing that allows motives to follow other motives is when they are at
different degrees.


Quote:Finally, I'll tell you what... I'll be willing to suspend what I've been taught in the past and take an honest look at this method. There will probably be many more questions to follow.

Shane

It's best to do what the waves do.

Much luck and good trades to you Shane.


Smile

TS Hennessy
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