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G144man wrote:
>>historically the only thing elliot wavers ever got was a chance to
wave goodbye to their money.
Sb wrote back:
>This is incorrect.
>
>This is a good example of someone passing a blanket judgement upon a
>methodology that they have not tested.
> Blanket mocking of any trading method without factual basis is a
waste of the writer and the reader's time.
Right on, SB. Among all the debunkers (if there is such a word), I find
that people are particularly vehement about hitting out at the Wave
principle. This is quite analogous to the non-technical investors and
traders heaping scorn on the technician. They do it because they do not
understand it. In the same manner, technicians who have not bothered
with even a cursory reading of the wave theory principles, are the first
in line to hit out at it. It seems to be some kind of fatal flaw in most
people's personality and G144 seems to be a victim of this. With
Prechter going off the mark some, they insist on throwing the baby out
with the water!
I personally use EW as my main analysis and trading vehicle. I have been
very very successful in calling all the major tops and bottoms (and
substantial number of minor ones too) in the Indian stock markets amd
this has helped me plan my trades and investments suitably. I could see
a large ABC set to develop and I got out of all my stocks including some
which had been held for over 15 years! The Indian markets plummetted
over the past three years and the majority of the second tier scrips
have outperfomed the index by several times. Had I held on to the
stocks, my equity would have got wiped out to the extent of over 80%! I
am still staying out of equities as I feel we are yet to complete the
major bear phase here. My money in the meantime is earning good interest
income in safe bonds.
While I apply the EW over the longer term, in the shorter term, there is
very little to beat it for a possible change in market direction. At the
simplest level, if a clear and I repeat, a clear five or a three shows
signs of termination, then I just take the other side of the trade. This
simple strategy has yielded my very good returns time after time.In
addition, I use hourly charts with RSI. I look for a divergence in the
RSI for the fifth wave of that degree. In a three wave pattern, the RSI,
7 times out of 10, sets up the divergence in the third wave (which would
be a "c") itself. I also use the MACD as suggested by Bill Williams in
Trading Chaos to check out the end of wave four. All these put together,
makes the EW work very nicely for me.
With a little change of the common cliche' "Those who can, do, those who
can't Criticise!".
Dr.Narayan.C.K.
Bombay, India.
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