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Scott,
Your treatise is an outstanding
example of what has not been
often published on this list or in the
industry generally.
I have long been a student of
SWINGS/WAVES. I even went to
the extent of spending a bunch of money to
take a cruise with
Precter and company to get a better
understanding.
I have purchased some very expensive EW
software.
As you undoubtedly know I have (WITH
COMPUTERS) been actively
chasing SWINGS/WAVES since the AppleII days
and have amassed
an unbelievable amount of data on swings of
all lengths from
all kind of indices and equities and
futures.
NO STATISTICAL EVIDENCE I HAVE ACCUMULATED
SAYS THAT THERE IS
ONE SHRED OF EVIDENCE THAT EW IS ANYTHING
MORE THAN A "DART
THROWING" STATISTIC ! ! ! !
HOWEVER:
What thinking of things in Elliott terms
does for ANYONE is to
make us examine each stage of the market in
terms of POSSIBLE
future scenarios. Even though there
is no proof that applying
Elliott in a "correct" manner has any real
statistical advantage
over just decently trading, the simple act
of examining what can
happen may in fact justify the whole cult
of Elliott.
Clyde
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - -Clyde
Lee
Chairman/CEO (Home of
SwingMachine)SYTECH Corporation
email: <<A
href="mailto:clydelee@xxxxxxxxxxxx";>clydelee@xxxxxxxxxxxx> 7910
Westglen, Suite
105
Work: (713) 783-9540Houston, TX
77063
Fax: (713) 783-1092 - - - - - - -
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<BLOCKQUOTE
style="PADDING-RIGHT: 0px; PADDING-LEFT: 5px; MARGIN-LEFT: 5px; BORDER-LEFT: #000000 2px solid; MARGIN-RIGHT: 0px">
----- Original Message -----
<DIV
style="BACKGROUND: #e4e4e4; FONT: 10pt arial; font-color: black">From:
<A title=scot.billington@xxxxxxxxxxxxx
href="mailto:scot.billington@xxxxxxxxxxxxx";>Scot Billington
To: <A title=realtraders@xxxxxxxxxxx
href="mailto:realtraders@xxxxxxxxxxx";>realtraders@xxxxxxxxxxx
Sent: Friday, November 17, 2000
12:33
Subject: Re: [RT] Elliott Wave
Those of you who are beginning or contemplating studying EW you
my find myexperience helpful.I worked as an analyst using
primarily EW for seven years. My job roughlyten hours a day was to
study EW and apply the counts to various markets.During this period I
would claim that I developed an above average toexcellent ability to apply
an EW count and alternates to a market within therules laid out in
Prechter's book.In my opinion while these counts did sometimes produce
Nostradomus-likemarket 'calls', they were not useful in making trading
decisions. They werecloser to a neat magic trick than a trading
tool. The major problem I havewith EW is who said the original
premise is valid in the first place. Mr.Elliott made some grandiose
claims and offered up an interesting theory thatmakes some sense under the
heading of mass behavior. This theory can not betested due to its
subjectivity. I must choose between time frames, closeonly or bar
charts, continuous, Gann, or individual charts. If I am using abar
chart, I must decide what makes a wave. Due to this subjectivity,
thereis no way to test Elliott's original premise that the markets move in
fiveand three wave patterns. Nor is there any way to test if the
patterns ofthe market must fit into the 13 (I think) different possible
patterns laidout. So, basically, we have a gentleman making a claim
that can not beverified or refuted.Certainly, some moves have
ended on five waves, but they have to end onsomething. And a move of
more than one wave must end in an odd number bydefinition. A five
wave move with and extension can be five, nine,thirteen, seventeen etc.
waves. Every other odd number. Therefore, halfthe moves must
end in a five wave pattern. Even if EW is not valid, I amgoing to be
'correct' with my five wave count 50% of the time. The
methodallows moves to end on three waves with its irregulars or by the
largerpattern being A-B-C. Therefore, I can end on three or five
with andextension in any of the waves of either. That covers all the
bases.Undoubtedly, there are those who have claimed to have made money
trading theEW. I would contend that while they made money (if indeed
they did), theymay not know WHY they made money. EW may only
generate random entrysignals, but they may use strong exit strategies and
sound money management.By using strong exit techniques and good money
management, one can take arandom entry and make handsome profits.
Even if they use EW to make theirexit decisions, it is not necessarily the
EW count that makes thosestrategies strong. Each part of the method
needs to be testedindependently, to show its effect. EW can not be
tested in any way.Therefore, we can not know if it is or is not
valid.(A good example of someone who makes a ton of money, but does
not know whyis a hypothetical profitable floor trader. Let's say he
makes $2 million ayear using method X. Wow, method X must be
great. But the floor tradertrades 2000 contracts per day 200 days
per year. He also has the flooradvantage of buying at the bid and
selling at the offer. The spread is 1tic each tic is worth $20, so
he makes $10 per contract vs. the value whichis between the bid and the
asked. $10*2000*200=$4,000,000. So, his edgeover the market is
not in method X; it is in the b/a spread.)Its is my opinion that a
beginner should look elsewhere for a tradingmethod. If they are
completely intent on trying EW, I would suggest thatthey find a mentor who
has used EW to successfully make profits in themarket not to write a book,
although those are not necessarily mutuallyexclusive. Furthermore, I
would take a hard look at the mentor's profits tosee if they are being
generated by something other than the EW counts.A note of
caution. EW does allow one to make some remarkable marketpredictions
whether these occur randomly or not. The method contends thatit has
figured out the secrets not only of the markets but of existence.These
predictions give one a feeling of omniscience and a surge of
power;therefore, this method of trading is appealing to those with a
narcissisticpersonality style. This personality style is marked by
extremely grandiosestatements, which Mr. Elliott certainly made about his
'discovery'. MrPrechter has exhibited traits of this personality
style as well. The narc.style puts a lot of its self-worth on the
idea of being 'right' and may nottake opposing views or questions very
well. This style is generally notconducive to long-term (>10
years) successful trading. If you decide to tryto study under
someone, do not believe the hype.If you have any questions, feel free
to e-mail me personally.Scot Billington----- Original Message
-----From: <<A
href="mailto:Sonnysark@xxxxxxx";>Sonnysark@xxxxxxx>To: <<A
href="mailto:realtraders@xxxxxxxxxxx";>realtraders@xxxxxxxxxxx>Sent:
Friday, November 17, 2000 10:39 AMSubject: Re: [RT] Elliott
Wave> Thanks Earl...good information.
-Sonny->>> To unsubscribe from this group, send an email
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