Elliott wave Principle was develop around 1930’s and since then many traders have been follow the theory and applying it in their everyday trading. We all know life is not perfect and nothing is 100% correct, same applies to the Elliott wave Theory. We have been trying over the last 11 years to take away the subjective nature of the Theory.
The Main thing is that the Theory fails in many aspects and we need to keep in mind that it developed based on Indexes which are not the same market as let’s say the Commodities or Forex. The big Difference is the Trend, every Professional trader knows that Indexes trend while on the other hand the Commodities and Forex are more of range markets. This presents huge differences when it comes to applying the Elliott Wave Theory and executing trades based on the theory in these markets. Execution is huge in Trading and also a part of practicing the Elliott wave Theory, below we will mention some points which every trader needs to know in order to apply and execute the Theory properly.
After all the Traders need to understand that The Theory was developed in 1930’s, and following the 5 waves and 3 waves back cannot be seen as reliable as the Theory can present. The Theory lacks a lot of adjustments to make it a reliable trading tool on it’s own. The Theory is a great observation which discovered the fractal movement in the Market either in 5-3-5 or 3-3-3 advance, but to believe the Theory by itself is good enough to trade is a mistake.
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