{"id":127009,"date":"2018-05-20T18:10:42","date_gmt":"2018-05-20T22:10:42","guid":{"rendered":"http:\/\/countingpips.com\/?p=127009"},"modified":"2018-06-01T15:39:45","modified_gmt":"2018-06-01T15:39:45","slug":"elliott-wave-predictions-for-us-stock-market-2018-and-beyond","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/forex\/2018\/05\/elliott-wave-predictions-for-us-stock-market-2018-and-beyond\/","title":{"rendered":"Elliott Wave Predictions for US Stock Market 2018 and Beyond"},"content":{"rendered":"
May 20, 2018<\/div>
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By TheTechnicalTraders.com<\/u><\/a><\/strong><\/p>\n

Recently, an interesting concept was discussed among our research team \u2013 a very interesting concept about the markets.\u00a0 As many of you know, part of the process or research is to test conclusions that may lie outside common thinking.\u00a0 While we were discussing the Fibonacci and Elliot Wave structures of the US market using longer-term charts, one item kept intriguing our research team.\u00a0 This one item could change everything in terms of how we are thinking about the US markets and Global markets.<\/p>\n

Almost everyone knows that Elliot Wave (EW) theory consists of Five Waves to complete a major EW Cycle.\u00a0 The most common form of EW price cycles is A, C & E (or 1, 3 & 5) waves advancing and B & D (or 2 & 4) waves declining for an uptrend.<\/p>\n

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Chart courtesy of\u00a0stockcharts.com<\/a><\/em><\/p>\n

The opposite is true for a downtrend.\u00a0 It is relatively common knowledge these types of price formations make up almost all of the markets price moves.<\/p>\n

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Chart courtesy of\u00a0stockcharts.com<\/a><\/em><\/p>

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Yes, there are variations that can sometimes come into play, like Triangle formations, Zig-Zag formations, Regular, Expanded, Contracting and other rarities.\u00a0 Yet, many people don\u2019t understand the mathematics requirements that apply to EW and Fibonacci as a method of constructing proper EW structures.<\/p>\n

The question proposed by one of our research team was \u201cwhat if this recent move higher (from 2011 to current) is nothing more than an extended wave 3 and not a wave 3-4-5 formation.\u00a0 What if this 166.94% rally in the SPY is nothing more than an extended Wave 3?\u00a0 This question began a quest within our team of research to try to identify if this concept had any validity \u2013 and the results are surprising.<\/p>\n

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BASIC CONCEPTS OF MAJOR AND MINOR WAVE FORMATIONS<\/h4>\n

Before we continue, allow us to explain some of the basic concepts of major and minor wave formations as defined by Ralph Nelson Elliot and Robert Prechter.<\/p>\n