Benefits of Elliott wave theory

“Wouldn't it be better if our analysis could tell that

Are the trends we are seeing now old or new?

or if it's going up How far can it go up?

If it's sideways (Sideway)

When will it end?"

Elliott Wave theory is a form of technical analysis used in Forex CFD trading.

Futures and stocks were developed by Ralph Nelson Elliott in the 1930s to identify recurring patterns in the market and predict future market movements. It is based on the idea that the market wavy And these waves can be used to identify trends and make predictions about future price movements. This theory is based on the assumption that the market moves in a pattern of "five waves", each of which consists of two parts: a motive wave, a corrective wave. A motive wave consists of five waves to develop a trend. Waves and used to correct the direction of the trend. by determining the direction of the trend and identifying waves Traders can gain an edge in the market and make informed trading decisions. By recognizing and analyzing these patterns, traders can identify high probability entry and exit points.

Benefits of Elliottwave

1. help identify trends

2. Identify reversal points within a trend.

3. Identify the end of the trend

4. Warns of the start of a new trend.

5. Give a high probability target price.

6. Identify the wrong point.

1. Help identify trends

The Wave Principle states that "actions occur in the price structure. that act in the same direction as a trend larger than one level will develop in 5 waves”. This is an important clue in trend analysis. It shows us where the main trend is moving from the formation of the 5 wave pattern. Motive helps us plan our trades. accurately and appropriately

2. Identify reversal points within a trend

When this action takes place, there will be a consequence: "a trend reaction with a larger scale will develop in three waves", and when the anti-trend reaction ends, prices will resume the main trend. It gives traders an opportunity to trade the trend again. And it helps traders not to jump into the market prematurely.

3. Identify the end of the trend

Within the Five Wave Motive pattern, the fifth wave is the last. when the price enters The fifth wave is therefore a warning before the price has a correction or a trend change. Allows traders to plan and accept those situations in a timely manner.

​4. Warn of the start of a new trend.

Waves in Elliottwave are recurring patterns. One complete cycle consists of 2 modes of 8 waves. Once completed, a similar pattern is formed on a larger scale. Warns of the start of a new trend. Traders have joined the trend again. in a bigger trend

5.Provide highly accurate target prices

Elliott said, "Wave structure is part of nature. Therefore, they are related to Fibonacci numbers. Therefore, the Fibonacci number sequence is the mathematical foundation of The wave principle" gives confidence and allows us to predict the point of a retracement and a high probability price target of the price pattern. For example, wave 2 usually retraces 61.8% of wave 1, or wave 1. 3 is often longer than 161.8% of wave 1, etc.

6. Identify the wrong point.

Elliottwave theory has rules and guidelines. with specific Able to identify points that cause analysis to go wrong Allows traders to plan or calculate the risk-reward ratio effectively, for example, wave 2 will not reverse beyond the beginning of wave 1 or wave 4 does not end within the territory of a wave, etc.

These may answer the question that is in the mind of anyone who is confused, what is the purpose of studying Elliottwave?

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@ElliotticianThai