Thank you for taking the time in marking up your Elliott count for us. I know from personal experience that it can take quite a bit of time and effort to do so as there is a lot to think about when applying correct Elliott labeling...the most important being the degree of trend that you're working with can make all the difference in the world when it comes to not only being on the right side of the market, but also having "the right look" of any price pattern sequence.
For those who aren't Elliott savvy...there are 3 hard and fast rules when applying an Elliott count that can not be broken:
1: Wave 2 cannot retrace more than 100% of Wave 1.
2: Wave 3 can never be the shortest of waves 1, 3, and 5 (impulsive or corrective...it doesn't matter)
3: Wave 4 can never overlap Wave 1.
So if we focus on the area from end of May to mid June 2023 where you marked as wave "3", you have broken two rules there as this is not only the shortest wave sequence compared with waves "1" and "5", but the flat formation that started in mid June into early July overlaps your wave "1" from March. Because of this, the corrective "flat" can only be labeled as a "B" wave and not wave "4"
In any event, since the price sequences have corrections 80% of the time, it's highly difficult to label where you are unless you have some sort of momentum tool, like the RSI, to help you along the way. My suggestion is to apply a 13 day RSI to the daily chart (or 8 period RSI for an intraday chart) for better clarity of count. Also remember that both wave "3" and wave "A" set momentum "flags" from which waves "5" and "C" eventually diverge from so you can pinpoint reversals...and more importantly...if the correctional sequence has concluded or not. Your use of line form on the chart is perfect as it cleans up the mess of using bar or candlestick charting methods. Daily volume will also help, as well as, sentiment. I would also suggest that you mark up an index that is more broadly based in its make up...the SPX vs. the Dow or the NYA vs. SPX. The more you data you receive (larger baskets of issues), the better the workable count.
Above all else, since Elliott Wave analysis is strictly a psychological extension of herd thinking, the most important thing in working with this tool is to be emotionally unbiased when working this format...something of which is very hard to do due to our human frailty to be scooped up into every day thought, and why many fail in working with this analysis where you're taking a theory and attempting to make it a principle.
Edited by fib_1618, 29 October 2023 - 03:51 PM.