Why Does Anyone Use Elliot Wave Theory At All?

Well said ValleyVintner !

Confluence is what I want.

The fractal approach is well laid out in the book ...... "Trading Chaos" by Bill Williams.
 
Mandelbrott article here
http://www.elliottwave.com/education/SciAmerican/Mandelbrot_Article2.htm

It's exaggerated to say that Mandelbrott cautions Elliott Wave. If you read the article in details Mandelbrott doesn't pretend that Market is predictable with fractals. Mandelbrott's fractals and Ewave fractals are of different nature: the first is stochastic, the second is deterministic. Mandelbrott doesn't affirm that market has a deterministic nature - notably that it follows magic "ratios" like Fibonacci - contrary to Elliott.

I suspect that Prechter wanted to profit from the scientific notoriety of Mandelbrott to create the polemic that Mandelbrott has tolen Elliott Idea whereas it is by studying the Nile than Mandelbrott creates his fractals theory.

I don't say that against Elliott Wave since my model rather cautions Elliott Wave (http://www.econometric-wave.com/articles/1/home.html.html) - although I didn't expect it at the beginning - rather only because I cannot still cautions all Elliott Wave in details only in principle (for example my model doesn't use Fibonacci ratios but they appeared at the end as effect of the model). I say that relatively to Mandelbrott who doesn't have any lesson to receive from the Elliottists as his research is conducted independtly of Elliott Framework and in details it is not at all Elliott Wave, only ressemblance in forms not in profound concept. Mandelbrott's approach is rational (he reasons with Activity) whereas Elliott is esoteric and falsely pretend to explain the generation of waves with psychology whereas my model pretends that it is rational activity described by Mandelbrott's above that is behind the waves. Why does it matter ? Because knowing the true cause allows better precision. Elliott is too combinatorial and this is due to the lack of understanding the true cause behind the waves.

Quote from valleyvintner:

Elliott was both an accountant and a numerologist? Even so, the fact that Benoit Mandelbrot appears independently to have reached conclusions quite similar to Elliott persuades me that the failings of EWT are in the practitioners rather than the theory.

Elliott's Wave Principle is essentially correct. The problems arise when people treat their personal wave count as if it were a road map which the market must inevitably follow. EW may be a roadmap but it's a map fraught with detours and signs saying, "Caution: Bears working." What looked like an Impulse Wave One on Monday can turn into a Corrective Wave B by Wednesday. If you know that and you're prepared to amend your map, EW can be helpful. I think it's especially good for estimating future support/resistance because the Golden Ratio (0.382, 0.50, 0.618, 1.618, 2.618 etc.) appears so frequently in every chart. But you have to be flexible. Hybrid TA/Quants like me try to find "confluence" in EW studies - instances where different time frames give the same common target or turning point. And even then you have to be ready to revise if the market shows you something has changed.
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Quote from valleyvintner:

Elliott was both an accountant and a numerologist? Even so, the fact that Benoit Mandelbrot appears independently to have reached conclusions quite similar to Elliott persuades me that the failings of EWT are in the practitioners rather than the theory.

Elliott's Wave Principle is essentially correct. The problems arise when people treat their personal wave count as if it were a road map which the market must inevitably follow. EW may be a roadmap but it's a map fraught with detours and signs saying, "Caution: Bears working." What looked like an Impulse Wave One on Monday can turn into a Corrective Wave B by Wednesday. If you know that and you're prepared to amend your map, EW can be helpful. I think it's especially good for estimating future support/resistance because the Golden Ratio (0.382, 0.50, 0.618, 1.618, 2.618 etc.) appears so frequently in every chart. But you have to be flexible. Hybrid TA/Quants like me try to find "confluence" in EW studies - instances where different time frames give the same common target or turning point. And even then you have to be ready to revise if the market shows you something has changed.
More...

Good post worht a bump.
Only 3 years late.
 
I seem to recall that Paul Tudor Jones had good things to say about Elliott Wave in his interview for Market Wizards. Aha, found it, on p. 130, in answer to the question What do you mean by opportunist?
 
Quote from Kwiatkowski:

I seem to recall that Paul Tudor Jones had good things to say about Elliott Wave in his interview for Market Wizards. Aha, found it, on p. 130, [/B]
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True;
he had some other helpful things also.

Got a postcard from EW , which i kept [ calling bear market rally];
3 or more years early.Better 3 years early than 3 years late:cool:
 
http://i11.tinypic.com/402pddv.png


I found that you can find times when this picture works, you have to look at it and try to see the patterns, change from candle charts to line when you're seaching for trades and there are many stocks that trade like this, if you look at the right side and see the inververse head and shoulders and then the failure ,this happens all the time and a lot of guys get caught in it but there are patterns within patterns that happen even if its a fake
 
My issue with EWT and Prechter is that they have a good marketing campaign in that ... people know them.

Most of the hedgies have heard about the idea and that alone is prob worth some decent coin.

If ANYTHING they had worked .... why not trade a test a account and post results.

Or ... they cant be making a ton of of ElliotWave.com ... why not pump there userlist ... get 10-20MM (which they could get ... just on name brand alone) and trade it.

I think the reason is clear .... they never traded because ... they are analysts not traders. They definitely believe in what they preach ... I know ... I subscribed for years .... but that nagging feeling as to why they dont exploit it ... always bothered me.

I had the same feeling about Gartman(although no where as strong as EWT) ... until he accidentally CC'd instead of BCC'd and his client list was exposed .... hes got a ton of dudes payin 10-15k yearly .... with that many he doesnt need to trade!!
 
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