Elliott Wave

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Guidelines

 Elliott Wave Rules & Guidelines of Wave

Formation

Fibonacci Applications

 How we can use them to define &

improve pattern recognition

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Complete Market Cycle

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Not This Easy…

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But not so difficult either….

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See something familiar?

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Qualify The Pattern

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Fib Targets - Head

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Fib Targets - RS

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Fib Targets - LS

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Entry

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Stop & Targets

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Trigger Point

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Retest

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Bingo !!

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Manage Trade

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And with Elliott…

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EW Guidelines of Wave Formation

1. Alternation
2. Depth of Corrective Waves
3. Extensions
4. Wave Equality (Time & Magnitude)
5. Channeling (Throw Over and Under)
6. Volume – (Divergence)
7. The Right Look
8. Wave Personality

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1. Alternation

 Waves 2 and 4 of Impulses

Sharp for wave 2 – Sideways for wave 4 (new
price extreme)
Often a Fib time relationship also

 Waves A and C of Corrections

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2. Depth Of Corrective Waves

 Second Waves
 50%, 61.8%, 78.6%, 88.6% Retrace of
Wave One

 Fourth Waves
 23.6%, 38.2%, 50%
Retrace of Third Wave

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3. Extensions
 Wave 3 of an Impulse Most Common in
Stock Market

 Wave 5 in commodities and Currencies

 First Wave Extensions are rare

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4. Wave Equality (Time & Magnitude)

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5. Channeling (Throw Over and Under)

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6. Divergence – Volume &
Momentum Indicators

 Wave 5 and wave 3

 Wave A and C

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7. The “Right Look”

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8. Wave Personality

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Wave Personality

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EW Guidelines - Extra
 Triangles
 Ending Diagonals
 Truncated Waves
 Third Waves
 Primary Angle of Trend

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Example

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Silver

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Channeling

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Fibonacci Applications

 At Least 2 Degrees of Trend

 Golden Ratio

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Fibonacci Retracements

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Impulse Wave Price Divider

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Impulse Wave Time Divider

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AUDJPY - WK

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Channel & Alternation

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Fibonacci Projections

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Fibonacci Retracements

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Add Labels

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What Next?

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Begin the process again

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Gold – Intra Day

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Qualify Structure / Pattern

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Good old channels

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Five Waves Down?

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Corrective Price Channel

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Something not right

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Re-draw Channel

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2nd Time lucky !

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Summary
 Using the WP successfully is not just
counting 1-5

 There are excellent rules & guidelines

we can use to formulate a trading plan
with the WP

 Fibonacci is an integral component to

the WP

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Recommended Study (Not Just a Read !!)

 Elliott Wave Principle – Frost & Prechter

 Visual Guide to EW Trading Wayne
Gorman & Jeffrey Kennedy
 Mastering Elliot – Constance Brown
 Fibonacci Analysis Constance Brown
 Technical Analysis for the Trading
Professional Constance Brown

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Contact

 www.elliottwaveireland.com

 michael@elliottwaveireland.com

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