Identifying Explosive Moves In Forex Trades By Counting Elliot Waves

While Elliot Waves Theory may be a complicating andor selling positions at the beginning of impulsive wave
sometimes controversial subject, it is easy to agree4, which can be easily identifiable as it normally
that some of the more common "counts" arecomes after the end of wave 3 which is typically the
universally acceptable, and are often seen acrosslongest wave.
most financial instruments being traded nowadays,Translated into day trading, what is needful for the
including forex and currencies.forex trader is just to ensure a software that can
The various variants aside, general elliot wave theoryidentifies in real time and to a good accuracy the
tells us that there are 5 waves or sub-waves within avarious waves involved. Often, by using an oscillator,
wave. These waves are called Wave 1, Wave 2,it is possible to know when a typical wave 4 has
Wave 3, Wave 4 and Wave 5 respectively.ended, especially when the oscillator has pulled back
Wave 1, is the beginning wave and comes after ato its zero line. The end of the 4th wave opens the
period of consolidation that signifies the end of a 5thdoor to trading the wave 5 moves upwards ...and
wave. Wave 2 is a corrective wave that comesthat means a good deal of profits in the trades as
after a wave 1. Wave 3 is an impulse wave upwards,you are able to enter the trade right at the beginning
and is often the longest of the waves, and canof the wave up.
typically be 1.618 times that of wave 1. Wave 4 isFor traders who desire to avoid the difficulties of
the corrective wave that follows wave 3, correctingwave counting, various other methods have been
and diluting the gains you can get during the impulseused to provide good trading profits. Chief among
wave 3 upwards. Finally, wave 5 is the last of thethem is the use of No-Indicators price action trading.
impulse wave upwards.In price-action trading, price and time are the main
Now, armed with this simple non-complicatedindicators used to identify the major entry and exit
understanding of elliot waves, we know that wave 3positions, allowing the forex trader to capture the
and 5 are the longest waves that can be tradeablesweetest part of the trading move and exiting just
for most gains and are impulsive waves upwards,before or slightly after the move has begun its
while wave 2 and wave 4 are impulsive downwaves.downswing.
With this in mind, the forex trader will attempt toElliot wave counting together with no-indicators price
identify the beginning of waves 3 and wave 5 toaction trading has proven to be a formidable pair of
enter buying positions, and ride with the trendtrading techniques employed by many forex traders
upwards.to earn substantial incomes consistently.
Similarly, the forex trader can enter shorting positions