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I don't use EW myself. Too subjective for my taste. But it seems to work
well for some people. So, the engineer in me wanted to see if there is
any logical explanation for the phenomenon. Here's what I came up with.
The gif shows a combination of
A trendline
A sine wave
Another sine wave with 1/4 the period and 1/2 the amplitude.
The top graph shows the combo and the bottom one shows the individual
components. I have no idea if this is what is going on. Judge for
yourself. If it is the mechanism, I suppose one could look at EW as a
crude form of spectral analysis. Works better for me than some of the
other voodoo explanations I've heard. :-)
--
Dennis
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