Indicator Elliott Wave
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    Smile Indicator Elliott Wave

    Dear RoboForex Forum members,

    I would like to present the Topic of - Indicator Elliott Wave as a part of the Contest

    First of all to be able to understand and use any Technical Indicator only knowing how it gives signals and what are the directions and colors to be looked is not going to take us far.

    Unless we will be able to understand what is the real Theory and knowledge behind that we cannot get to use it with success.

    So I will try to present the basic Theory before giving the Full details of how we should be using the Elliott Wave Indicator in our trades.

    If you have any questions or doubts regarding the use of this Indicator please ask.

    Thanks

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    What is an Elliott Wave?

    It comes from the Elliot Wave Theory that was originally given by the Ralph Nelson Elliot in a study which he published in 1938.

    It was being proposed for use in the trading markets like Stocks, Forex, Metals, Oils and Commodities.

    The basic premise on which the Elliot wave Theory is founded is based on the perception that whatever moves we see in the markets are a result of the culmination of the market participant’s reaction and the overall effect it has on the price movements seen.

    If we can know what a majority of the Forex traders are thinking then we will surely know which direction the markets will go and the Elliot wave Theory aims to give us such knowledge which is valuable to our trading if we can use it and understand it correctly.

    Using the Elliot wave analysis we can actually learn a lot about the market and its movements since we get to know about the behavior of the traders and thus we get to know the impact it will be having on the Price movements.

    I will show you using the Elliot wave analysis how you can get to know the Forex markets more deeply and thus get to trade with success.

    I will be with you in the path towards success using the Elliot wave theory and this contest is just a means to explain about this in details to you.

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    Why we have to use the Elliot Wave Theory?

    If you have been trading in the Forex for a certain time period of more than 6 months you will notice that any currency pair that you will pick will start behaving in a manner that it has already done in the past.

    The type of moves that it will exhibit is Predictable from its past actions and thus we can utilize the Elliot wave theory in understanding those and predicting the future moves with success.

    The moving forces in the Currency markets decide how the given currency pair is going to move in reaction to a news or event. And we can understand them if we will use Elliot Wave theory.

    In any form of Technical Analysis that we may be using it is the general behavior of the traders we try to gauge and using Elliot wave we can easily predict it. If we can understand it we can tell how much UP or DOWN a given currency pair is going to move and how we can plan our trades around that movement.

    I will tell you about the Elliot Wave Cycle that explains at which position the current trading is going on and what do we expect from here on, thereby allowing us to correctly Estimate our Entry and Exit from the markets.

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    What is Elliot Wave Cycle?

    Attachment 12603

    Elliot Wave cycle consists of 5 waves about which we have to understand.

    1st Wave = Trend movement

    2nd Wave = Counter Trend movement

    3rd Wave = Trend movement

    4th Wave = Counter Trend movement

    5th Wave = Trend movement

    At any point of time a market will remain in one of the 5 waves which we have to understand. 1st, 3rd and 5th Waves are in the direction of the Trend while 2nd and 4th wave is against the Trend.

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    Understanding Elliot Wave Theory

    The patterns that we see in the Forex markets are a result of the behavior that is being exhibited by the traders and if you are monitoring the currency that you want to trade you can see similar types of patterns. Once we can understand these Chart patterns then it will become easy for us to predict the Future movements of the price based on the current market scenario.

    All types of patterns that we see in the market are a result of Price Action which consists of Trends and Corrections. It is the ability of a trader to understand them and trade in the direction of the Trends.

    Impulse Waves = The movements that happen in the Direction of the Trends. In these waves the gain in the markets is more and price moves up Higher. It is a very powerful wave and it will consist of 5 waves.

    Corrective Waves = The movements that happen against the Direction of the Trend. In these waves the markets correct them-self and seem to struggle. Corrective waves consist of 3 waves and these are a part of consolidation phase.

    We can see an Impulse Wave which consists of 5 waves and a Corrective Wave which consists of 3 waves. In different time frames we can see these types of Waves and bigger waves can be made up of smaller 5-3 combination of waves.

    If there is an Impulse move in a Bearish market it will take 5 waves down and 3 waves up.

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    Wave Modes

    We have two types of Wave modes that work in the markets.

    Motive = In the Motive Wave we see a 5 wave cycle as shown above which moves the market upwards.

    Corrective = In the Corrective Wave we have a 3 wave cycle which moves the market downwards.

    Attachment 12604

    As you can see we have a 3 wave corrective cycle

    Wave A = Counter Trend movement

    Wave B = Trend movement

    Wave C = Counter Trend movement

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    1. Indicator Elliot Wave Oscillator

    Description of indicator

    Indicator Elliot Wave Oscillator = This is an Indicator for Meta trader 4 that will allow a trader to know when an Elliot wave has ended and a new one has started. I am using it on the 1 minute time frame to give a fair idea of the Price movements in the Euro. The Green area signals a BUY while the RED area signals a SELL.

    Features and principles of indicator

    How to read Elliot Wave Oscillator (EWO)
    • The highest point of the EWO is the Bullish Wave 3
    • The lowest point of the EWO is the Bearish Wave 3
    • Wave 4 crosses over the zero line opposite to the direction of the main trend
    • Wave 5 iis the new Hig or low of the Swing


    Supporting screenshots

    I am giving Chart for M1 EURUSD using this Indicator.

    EURUSDM1.png

    As you can see that in the current market scenario it has signaled a Bullish Entry to BUY EURUSD and market is slowly moving upwards today.

    I am giving Chart for M1 GBPUSD using this Indicator.

    GBPUSDM1.png

    As you can see it has signaled a Bullish Entry in GBPUSD and the pair is moving upwards.

    I am giving Chart for M1 USDJPY using this Indicator.

    USDJPYM1.png

    As you can see it has signaled a Bearish Entry in USDJPY and the pair is moving downwards.

    Personal opinion and recommendations

    I am using this Indicator Elliot oscillator waves 1.02 on M1 and M5 time frames with success for Intra-Day trading. I have tested this indicator in EURUSD, GBPUSD and USDJPY. I will recommend this Indicator for those traders who are doing Intra-Day trading.


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    Last edited by nsawork; 05-20-2015 at 06:56 PM.

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    As far I know about Elliott Wave its a technical method of trading right? One more thing is screenshots and indicator both are missing in this thread, so please attach them too. I am really very exited to know about the features of your elliot wave indicator. Hope you will listen me and will attach them soon as possible. Waiting for your answer

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    Trader nsawork's Avatar
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    Quote Originally Posted by Earnperfect View Post
    As far I know about Elliott Wave its a technical method of trading right? One more thing is screenshots and indicator both are missing in this thread, so please attach them too. I am really very exited to know about the features of your elliot wave indicator. Hope you will listen me and will attach them soon as possible. Waiting for your answer
    Dear Earnperfect,

    Please refer to the Introduction that i have posted in the Thread.
    I will try to present the basic Theory before giving the Full details of how we should be using the Elliott Wave Indicator in our trades.
    Using a Technical Indicator without knowing the Basic Facts about it is like jumping in the water without knowing its depth.

    In my subsequent posts i will Give Everything that is required.

    Thanks

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    Last edited by nsawork; 05-18-2015 at 07:32 PM.

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    Yes friend as you said Elliot waves can helps us to understand the market conditions. It can also help a trader to solve the probability problem in trading and works best when trader has realistic views. I would like to open trades at the start of the 5th wave which is the end of the 4th wave( 2nd corrective wave). What you think about it?

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    Trader nsawork's Avatar
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    Quote Originally Posted by PROPENSITY100 View Post
    Yes friend as you said Elliot waves can helps us to understand the market conditions. It can also help a trader to solve the probability problem in trading and works best when trader has realistic views. I would like to open trades at the start of the 5th wave which is the end of the 4th wave( 2nd corrective wave). What you think about it?
    The decision to trade will depend on the Time frame that is being used and the momentum of the corrective waves. The 3rd wave in the Trend movement is a stronger wave and is easy to be identified. You can use Pending orders to Realistically enter at anytime after 3rd wave.

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    Last edited by nsawork; 05-20-2015 at 04:07 PM.

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    2. Indicator Elliot oscillator waves 1.02

    Description of indicator

    Indicator Elliot oscillator waves 1.02 = This is an Indicator for Meta trader 4 that will allow a trader to know when an Elliot wave has ended and a new one has started. I am using it on the 1 minute time frame to give a fair idea of the Price movements in the Euro. The Ssky Blue signals a BUY while the Violet Red area signals a SELL.


    Features and principles of indicator

    How to read Indicator Elliot oscillator waves 1.02

    • The highest point of the EOW is the Bullish Wave 3
    • The lowest point of the EOW is the Bearish Wave 3
    • Wave 4 crosses over the zero line opposite to the direction of the main trend
    • Wave 5 iis the new Hig or low of the Swing


    Supporting screenshots

    I am giving Chart for M1 EURUSD using this Indicator.

    EURUSDM2.png



    As you can see that in the current market scenario it has signaled a Bearish Entry to SELL EURUSD and market is going down.

    I am giving Chart for M1 GBPUSD using this Indicator.


    GBPUSDM2.png



    As you can see it has signaled a Bullish Entry in GBPUSD and the pair is moving upwards.

    I am giving Chart for M1 USDJPY using this Indicator.

    USDJPYM2.png


    As you can see it has signaled a Bullish Entry in USDJPY and the pair is moving upwards.

    Settings for this Indicator

    ema2.png

    Short period = The default value is 5 you can set it to the required value according to the EMA required.

    Long Period = The default value is 35 you can set it to the required value according to the EMA required.

    EMA stands for Exponential Moving Average

    Personal opinion and recommendations

    I am using this Indicator Elliot oscillator waves 1.02 on M1 and M5 time frames with success for Intra-Day trading. I have tested this indicator in EURUSD, GBPUSD and USDJPY. I will recommend this Indicator for those traders who are doing Intra-Day trading.


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    Last edited by nsawork; 05-20-2015 at 06:57 PM.

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    Trader Doge's Avatar
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    I think that oscillator is actually the Bill Williams' Awesome Oscillator, which in itself is 5/34/5 MACD.
    It is actually meant for Elliot Wave counting, the most important tip is where the biggest hump is made - there is the impulse wave 3.
    A condition for this to work is to choose such timeframe that the number of bars for the wave-sequence counted to be between 100 and 140.
    There are other tips ins books for Elliot wave counting also, as his system is based on Elliot waves no matter it doesn't actually include counting.

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    Wow. Much Forex. So Monies. Very Opportunity.Many Trade. So Amazed. Wow.

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    3. Indicator Elliotwave_confirmation

    Description of indicator

    Indicator Elliotwave_confirmation = This is an Indicator for Meta trader 4 that will allow a trader to BUY and SELL based on the RED and GREEN arrows. A GREEN arrow signals a BUY whereas a RED arrow signals a SELL in the time frame it is being used.

    I am giving Chart for M1 EURUSD using this Indicator.

    Features and principles of indicator

    This Indicator works best in the Scalping since it gives pretty accurate signals in the Short term periods. It is better suited to be used in a ECN Trading account which have near to Zero Spreads.

    Supporting screenshots

    EURUSDM3.png

    As you can see that in the current market scenario it has signaled a Bearish Entry to SELL EURUSD and market is going down.

    I am giving Chart for M1 GBPUSD using this Indicator.

    GBPUSDM3.png

    As you can see it has signaled a Bullish Entry in GBPUSD and the pair is moving upwards.

    I am giving Chart for M1 USDJPY using this Indicator.

    USDJPYM3.png

    As you can see it has signaled a Bullish Entry in USDJPY and the pair is moving upwards.

    Here Red arrows Indicate a SELL while a Green arrow Indicates a BUY suited for Scalping.

    Settings for this Indicator

    EMA.png

    Faster EMA = The default value is 5 you can set it to the required value according to the EMA required.

    Slower EMA = The default value is 6 you can set it to the required value according to the EMA required.

    EMA stands for Exponential Moving Average

    Personal opinion and recommendations

    I have used this Indicator for Scalping and it has given some good results. Though i normally do not prefer to do scalping trades and this is also a reason why i am not using this one in my trading

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    Last edited by nsawork; 05-20-2015 at 07:04 PM.

  9. #9
    Trader nsawork's Avatar
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    Quote Originally Posted by Doge View Post
    It is actually meant for Elliot Wave counting, the most important tip is where the biggest hump is made - there is the impulse wave 3.
    A condition for this to work is to choose such timeframe that the number of bars for the wave-sequence counted to be between 100 and 140.
    There are other tips ins books for Elliot wave counting also, as his system is based on Elliot waves no matter it doesn't actually include counting.
    I think that oscillator is actually the Bill Williams' Awesome Oscillator, which in itself is 5/34/5 MACD.
    No this is not an Awesome Oscillator

    Awesome Oscillator is a 34 day SMA subtracted by 5 day SMA

    The Forumla for calculating the Median Price is as follows:

    MP = Median Price = ( High + Low ) / 2

    SMA = Simple Moving Average

    And the Formula for calculating Awesome Oscillator is

    Awesome Oscillator = [ SMA (MP,5) - SMA (MP,34) ]

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    Advantages of Indicator Elliot Wave

    1. It is used to Forecast the Future direction of Prices.

    2. It can be used for Stocks, Indices, Currencies, Metals, Oil and commodities.

    3. It gives market sentiment way ahead letting you to decide and trade in the direction where the market is going.

    4. Using this you can limit your losses and maximize your profits as your timings in the Entry and Exit of trades will improve.

    5. It can be used in any Time frame.

    6. It makes use of the Elliot Wave Theory thus allowing you to understand where the prices are moving in the Current market Trends.



    Precautions while using IndicatorElliot Waves

    1. Learn to observe the Wave patterns in your given Time-frame by observing them daily.

    2. Wave 3 is the strongest wave in the Direction of the Trend so Make an entry in this Time.

    3. Do not enter during Wave 4 which is a corrective wave downwards.

    4. Final entry can be made in the Wave 5 which is in the direction of the Main Trend.

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