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Elliott Wave Theory
(redirected from Elliot Wave Theory)

   Also found in: Acronyms 0.01 sec.
Elliott Wave Theory
Technical market timing strategy that predicts price movements on the basis of historical price wave patterns and their underlying psychological motives. Robert Prechter is a famous Elliott Wave theorist.

Elliott Wave Theory
A theory of price movements stating that all stocks move in waves roughly analogous to waves found in nature. The Elliott Wave Theory holds that stock prices move up a total of five times and down a total three times in succession; once the cycle is completed, it starts again. Unlike other, similar theories, the Elliott Wave Theory does not apply any particular time frame to its waves.

Elliott Wave Theory
A technical tool developed in the 1930s by R. N. Elliott for explaining stock price movements in terms of the sociological factors of investor optimism and pessimism. The theory holds that market movements occur in five waves in a given direction (up or down) followed by a correction of three waves in the opposite direction. According to the theory the wave patterns repeat themselves and can be used for forecasting market movements.


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Can charts, combined with all of the above and wave theory, primarily Elliot Wave theory, run ahead of events such as product announcements, drug approvals and gold mine discoveries?
The Strategy is agnostic to fundamentals and focuses purely on technical analysis and Elliot Wave theory.
But the fact is that no matter how we define the structure of the market, whether based on Dow Theory, or Elliot Wave Theory, or through an indicator based approach, it is important to remember that this structure defines PAST market movement.
 
 
 
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