My Forex Prediction using Advanced GET - page 66
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I am umpteen years behind in Elliott Wave softwares. No money to upgrade as the cost of living and the cost of softwares have skyrocketed beyond my means that I am forced to do stock market trading and forex trading using "grandpa" versions of the softwares.
The GET I have is a "grandpa" eod version that is almost 10 years ago.
And the Elwave I managed to revive is also a "grandpa" version that may be as old as the GET or slightly younger.
But I am grateful that both still works well and hard, though I think most modern-day traders will not be using such outdated softwares.
Today I want to take a look at Elwave and see whether I can also do trading using their Wave Counts and not their Signals.
As a case study, I am using EURJPY since from GET's chart pattern, it shows it is in a Primary Wave [3] Up.
I am attaching 2 charts from Elwave ie (1) a full chart of EURJPY from 2001 to today with the last bull run ending somewhere in 2008 and (2) a Zoom-In chart that focuses on the current year ie 2009 part of its price movements.
FULL CHART: First thing I did is to counter-check the Elwave chart against GET and find that both have their last bull run ending around July- Aug 2008 as I would not expect both to be at precisely the same date.
Once I am satisfied that both GET and Elwave are synchronized though not 100%, I shall then proceed to item (2).
Zooin In Chart: In the second chart, I look at 2009. We shall ignore the Summary Inspector though they are useful - purely for the purpose of identifying whether we should be trading this currency and how should we do it.
Starting with the Wave Tree on te left, we see it is Wave 3 UP all the way from Cycle, Primary, Intermediate and Minor. Any lower subwaves down the line, I have deliberately ignored them.
Looking at the right side - we see vertical lines - these are the targets of the Wave 3s of Minor, Intermediate and Primary wave degrees.
Now we look at the Primary Wave degree. It has completed its correction in Wave [2] and Wave [3] is now in progress.
Similarly, Intermediate Wave (2) is also completed with Wave (3) in formation.
Finally, Minor Wave 2 is completed with Minor Wave 3 in formation. An IDEAL point to enter a Buy was when it completed its Minor Wave 2. But we have missed that part.
Prices are now mid-way in Minor Wave 3. YOU CAN STILL ENTER A BUY AND YOUR STOP LOSS WILL BE 5 PIPS BELOW WAVE 2 LEVEL.
The reason why we can still buy are (1) price is now at/near bottom of the MINUTE Wave 3 price channel, which is in formation (2) they are in Minor Wave 3 - an Impulse wave in formation.
We would expect Minor Wave 3 to go BEYOND Minor Wave 1.
We can make our trading decision based along the above lines of Elliott Wave analysis without having to concern ourselves with lower wave degrees of Minute, Minuette, Subminuette, Micro and Submicro.
I trust the above explanation will help users of GET and/or Elwave to have a better understanding in using these softwares to do their trading.
Kenneth
As I mentioned in this morning's posting, I am going to long EURJPY.
Bought at 137.45 and Sold at 137.75 making a gain of 30 pips or US$327.97 within 1 hour 4 mins. This is one the fastest time span in closing a trade.
Later I will post details of my trade for yesterday and today.
Kenneth
Attached are 2 charts for EURJPY - one for today and one for yesterday for comparison purposes.
The Wave Counts are still the same as yesterday ie:
1. Primary Wave [3] Up
2. Intermediate Wave (3) Up
3. Minor Wave 3 Up IN PROGRESS
The next target will be the level of Minor Wave 1 which is 138.71; When it hits this level, it is likely to retrace, then move on to a level higher than Minor Wave 1.
That is the Elliott Wave Theory - that Wave 3 will be ABOVE Wave 1.
I have IGNORED Minute subwaves as these are more volatile and easily break some of Elliott Wave's rules. That will make us confused.
I like to look at the BIGGER PICTURE.
So using Elwave as a supplementary/complementary tool, it helps to confirm my analysis of GET that we can continue to LONG on this currency pair until its wave cycle is completed.
Good Trading
Kenneth
Here an alt wave count view of eurjpy,
Here an alt wave count view of eurjpy,
Thanks, GreatYves.
This Aternate Wave Count is even "fantastic". These are the possibilities:-
1. When the chart pattern is a Triangle in an Elliott Wave ie after Wave e, prices are going to ZOOM UP since the Wave e is the last leg down in the triangle within Wave B.
2. It will BREAK THROUGH WAVE A of the ABC. According to Elliott Wave Theory, it is going to be a dramatic C.
Putting the pieces together, whether it is Primary Wave [3] Up per the chart I put up OR WAVE C per this chart, IT IS ALSO GOING UP.
And it is certain [3] or C will NOT end so soon. So, I can continue to LONG this pair but make sure I do not enter at a time when the Daily Bar is moving down ie a bearish candle - that is how I do my entries in a LONG trade.
Kenneth
All that I need, as a day trader, is give me a currency pair that is WELL ESTABLISHED in its PRIMARY WAVE [3] or PRIMARY WAVE [5], and I will be trading it EVERY DAY to squeeze every pip out of it.
This was how I was shorting GBPJPY for the last few weeks UNTIL its downward wave is completed, then you won't see me trading this pair until a New Wave Cycle begins.
Sounding a Warning: On the day of the battle, from the Pacific Open I have learned to wait for a while UNTIL THE MAJOR TREND WE ARE TRADING has resumed, then only you act.
This is to avoid being "trapped" in a contra-trend situation.
Hope readers will bear this in mind.
Kenneth
Bought at 136.79 and Sold at 137.28 for a gain of 49 pips or US$534.76 within 13 hours 25 mins.
Shall attach details of my trade tomorrow.
I am off to sleep now.
Kenneth
As I mentioned in this morning's posting, I am going to long EURJPY.
Bought at 137.45 and Sold at 137.75 making a gain of 30 pips or US$327.97 within 1 hour 4 mins. This is one the fastest time span in closing a trade.
Later I will post details of my trade for yesterday and today.
KennethAttached is the file containing the above trades. Take note of the time the orders were placed ie GMT, how far it has gone up before order placed and the time span for the trades to close.
Pacific Opening Time is the starting basis.
Kenneth
This evening I will be presenting an article on the Differences in Trading Approach between a Day Trader and a Swing Trader in the use of Elliott Waves.
It is not so much a question of who makes more BUT RATHER what are the essential differences in their techniques for entry and exit and what determines it.
Kenneth
Background:
By definition a Day Trader closes his trade on or before the close of the day ie NY close. Sometimes the term “day trader” is misunderstood. The public thinks a day trader is someone who trades every day. The trader who does this is more aptly termed as a “compulsive” trader. Not every day will be a trading day for the day trader. He trades on days when he sees high probability trade setups, then only he trades , and hopefully he will make a gain in the process.
All his efforts are focused on ONE DAY and he trades under stringent rules in a market that is daily often inundated with market “noise” that can swing prices up/down by 200 pips easily. If he senses (through the use of technical tools) that the market direction is against his trade, he will not hesitate to close his position immediately to cut his loss.
He therefore works under pressing time restraints as each hour ticks away, his remaining hours are shortened.
On the other hand, the Swing Trader (by definition holds his trade for 2-7 days) and the Position Trader who holds his position for weeks or months has the luxury of time in his favor. Very often these traders are trend followers and made their entries at/near the beginning/end of a major trend depending whether he is a Bull or a Bear.
A main risk to the Swing/Position trader is there will be a number of consecutive days when the trend is against the main direction and the accumulated paper loss can be a huge one before it resumes in the direction of the main trend. Can he survive/withstand this onslaught? Sufficient financial resources is a very important consideration especially for Position Traders.
Approaches designed for Position and Day Traders: Against this background, trading system developers have designed and developed all kinds of systems to cater for these 2 categories of players and lauded their latest state of art and technology. If we try to experiment even with a few of these systems, we may be broke even before we start to trade. These softwares cost “a bomb”.
My Attitude towards Trading Systems: Although I am using both GET and now Elwave 6.2 softwares, I do not regard them as “trading systems” but rather treat them as ANOTHER TECHNICAL TOOL like any of the conventional technical indicators we have in Metastock.
And whether we are a Day Trader or a Position Trader, the first thing is to IDENTIFY THE MAIN TREND, and we can equally use Moving Average to do this job – 10, 30, 50, 100 and 200 days MA albeit it is time lag, and I still use these MA often.
Use of Elliott Wave Theory in our Trading Approaches: Because I regard GET and Elwave as a technical tool, it is the first tool I use to identify the MAIN TREND.
I am BOTH A DAY TRADER and a POSITION TRADER. In the Malaysian stock market, I am a Position Trader holding my position as long as even 5 years to multiply my investments, and in forex trading I opt to be a Day Trader – the reason being simple: I cannot withstand the trading psychological and financial impact of heavy losses.
Trading Approach by Position Trader: The aim of any Trend Following system/approach is (1) to get in at/near the bottom of the trend if I am a Bull and to sell when it is at/near the top of the trend and (2) to sell at/near the top of the trend and buy back at/near the bottom of a downtrend if I am a Bear.
The Beauty of Elliott Wave Theory as a trending approach is that it categorizes the wave-like chart patterns into a number of levels which they call Wave Degrees, starting from SuperCycle, Cycle (which I ignored for trading purposes).
The area of interest for me as a Position Trader is in Primary, Intermediate, Minor and Minute Wave Degrees. More often it is the first three wave degrees which I focus on.
Taking EURJPY and USDJPY as our case studies (for which I am attaching a doc file containing these 2 charts), we will examine how we make use of Elliott Wave Counts as our Entry Point and Stop Loss levels.
We will also calculate what will be our profit from Entry Point to Today as (1) a Primary Wave Degree Trader, (2) an Intermediate Wave Degree Trader and (3) a Minor Wave Degree Trader and (4) the number of days we hold our trade.
No matter which Wave Degree Position Holder we will be, there will be ONLY ONE TRADE and we shall hold on UNTIL that Wave Degree completes its full cycle.
Primary Wave Trader:
Looking at the EURJPY chart, on the left side, we see that we are in PRIMARY WAVE [3] UP which is in formation. It will NOT be completed until it finishes Primary Wave [5].
Your ideal Entry Point will be at Primary Wave [2] level ie 126.99; assuming you are UNABLE to do so but you entered above this level. Your STOP LOSS will be 126.99 less 5 tips when prices violate this level and the rule of Elliott Wave Theory is violated.
Today it is 138.05 a gain of 1106 pips. The Entry date was May 18, 2009 to Oct 23, 2009 is 159 days.
Intermediate Wave Trader:
Here again, on left side, Interimediate Wave Degree is Wave (3) UP which is in formation. It will NOT be completed until it finishes Intermediate Wave (5)
Your Entry Point is Intermediate Wave (2) Level ie 126.99 and assuming you are UNABLE to do so but you entered above this level. Your STOP LOSS will be 126.99 less 5 pips.
The Entry Date was July 8 2009 to today is 108 days with a gain of 1106 pips.
Minor Wave Trader:
The left side shows the Minor Wave Degree is in Wave 3 UP in formation. It will NOT be completed until it finishes Minor Wave 5.
Your Entry point is Minor Wave 2 at 129.05; your Stop Loss will be 129.05 less 5 pips. Today at 138.05 you will make 900 pips.
The Entry date was Oct 2, 2009 to today, it is 22 days.
I hope readers will now have a better grasp of how to trade the Wave Counts.
Q: What happens if YOU MISSED THE BOAT and you want to ENTER IN THE MIDST of the Wave.
Time does not permit me to write further, as I have to go out.
But I shall resume tomorrow evening.
Kenneth