Hello fellow traders, welcome to Elliott Wave Forecast. In this technical blog we’re going to get through some basic stuff of Elliott Wave Theory in order to help you get started with it. Many of you probably already know that Elliott Wave is the most powerful form of Technical Analysis used to forecast financial market cycles and trends by identifying extremes in investors’ psychology. Any possible price structure that could be imagined is already defined in Elliott Wave Theory and there’s an adequate Elliott Wave pattern for it.
Learning all those various types of patterns is long term process which can take months or years, but as every great journey begins with a single step, you will have to make it sooner or later, so let’s do it now.
Nowadays market is mostly made of corrective patterns so the first step would be to learn to recognize 3 wave structures on the charts. Sounds quite easy, doesn’t it ?
At the picture below you will see a book example of the up trend corrected by 3 waves pull back labeled as WXY