Elliot Wave and Patterns

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Some chart examples of Divergence, Gartleys,EW, Fibs.
Courtesy of Loren,thanks.
Feel free to post your own!

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Eur/Gbp 1min Gartley

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Nzd/Usd 4hr Butterfly w Reverse Neg Divergence.

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Usd/Cad Yearly

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Usd/Cad Weekly/ Daily

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USDX Weekly Butterfly, Fibs, EW

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Chf/Jpy Weekly fibs, abc.

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Gbp/Usd Daily Fib, EW

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Attached 1 hour chart depicts construction of uptrend channel lines and three long trades incident to that trend.

Lower trend line commences at chart low and establishes an uptrend line at 40 degrees. This angle is determined by use of the last green dot (fractal low) midway through the up cycle. The upper trend line follows the same angle of increase as the lower line. The distance between the upper and lower channel lines is 445 pips. The lime green line at the same angle is 111 pips above the lower line (25%of the distance between the upper and lower channel lines).

The two horizontal red lines identify a period of consolidation and documents important support and resistance levels. Ultimately price lows during that consolidation were below the lower lime green line. Long entries in an uptrend should be entered when price is in the lower 25% of the channel. Later another long trade was entered when price again retraced more recently.

Two Fibonacci retracement and one expansion studies are used. The first retracement study begins at the chart low to high in dark gray. Price retraced between 23.6 and 38.2 and argues the uptrend is strong and that price should easily exceed the previous high. The second retracement study begins at the lower red consolidation support line to the chart high and is viewed in green. Price retraced to 61.8 marked by a fractal low at that point. Price was then below the 25% line a point at which a long trade was entered.

Fibonacci expansion study viewed in blue shows expansion below FE 100.

RSI(14) blue line at this time was above 50 and pointed up which also argues an uptrend is in place. 4 Hour and daily periods also report RSI above 50. Daily period suggests price is presently tracing wave 5 of the Elliott Wave cycle.

Comments;

Those interested in construction and use of trend lines please see “Channel Surfing” by M. Parsons.

In creating uptrend lines it is a mistake to always use price lows. The example in this chart shows that periods of consolidation/ retracement (bears correct bull behavior) establishes a more reasonable angle of increase. Yes judgment is required incident to construction of a valid trend line. Periods of consolidation are most instructive to the technician incident to this effort.

During Waves 3 and 5 price will often revisit levels below the 25% line which offers another opportunity for a lower risk long trade.

The above comments equally apply to down trends.

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Sunday March 28 Butterfly