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Wolfe Wave

Decoding Wedge PatternsThere is a strong bias about chart patterns and their interpretation in the technical analysis space. It is a very common belief that a rising wedge forms bearish sentiment and a falling wedge forms bullish sentiment. Is that really true and how much we can rely on such bias? In order to understand this, we need to dig a little bit about how such concepts could have come into the picture. The best I could get on the internet is an article from Investopedia that explains few technical reasons and constraints of using these patterns. Through the Lens of Diagonal Waves But, when I was studying the concepts of waves, this is what I found from one of the sources I referred to about diagonal waves: ewtaf.com Details are summarised and explained in the below diagram The summary here is, Diagonal waves of contracting types are the same as that of Contracting Wedge patterns. And the diagonal waves of Expanding types represent expanding wedge chart patterns. Diagonal Waves can appear as sub-waves in multiple parts of the entire Elliott Wave. And here are our scenarios Leading Diagonals Leading diagonals are diagonal waves that can appear towards the start of a trend. This can be Wave 1 of an Impulse Wave - This is the start of a new trend. Avoid trading these wedges as they can be short pullbacks. Or better look for pullback and trading opportunities in the direction of the wedge. Wave A of a Zigzag Wave - This can lead to a possible bull trap or bear trap. The corrective wave is likely to continue after a small pullback Ending Diagonals Both expanding and contracting types can be ending diagonals. Can appear as Wave 5 of an Impulse Wave - Meaning the trend is coming towards possible exhaustion. Wave C of zigzag or flat - Correction or pullback is coming to an end and the trend is likely to continue Wolfe Wave Wolfe wave is a rule built on top of wedge patterns to identify time-bound targets. The idea of generating targets and stops based on the Wolfe Wave is as shown below:  Further, here are a few indicators developed in Pinescript that can help do them automatically. Wolfe Scanner Wolfe Strategy Takeaways Here are a few things we learnt from our study. When you are looking for wedge patterns on the chart, look for wedge formations created by 5 pivots. You can learn more about this from this post Fitting Patterns To Your Bias? Before trading a wedge pattern, try to identify if the pattern fits in a bigger scheme of things. Check if they are towards the end/start of a trend or pullback Concepts such as Wolfe Wave can help setup rules for trading wedge patterns for pullbacks.
Education
by Trendoscope
9
HOW-TO: Wolfe Strategy [Trendoscope]Just made this short video to explain the concepts of Wolfe Strategy which I recently published. Wolfe wave is popular concept among option traders. However, I have made some tweaks in this strategy to standard wolfe pattern trade rules. Entry price based on breakout No moving target - using flat target. Entry is done based on risk reward Not time bound Intelligently decides whether to place stop order or limit order Few possible future improvements Make bidirectional trades possible Better filters to chose long and short trades or when to trade Lot can be improved on Wolfe scanner to identify more patterns Exit strategy - can introduce optional trailing Thanks for listening. Hope you enjoyed and learnt something from this :)
Education
by Trendoscope
4
Don’t bite the bait. Time is money. This is a case of comparative advantage. Which means the less time it takes the coin to produce oil or energy, maybe even transactions. All will go down and then pop back up, much like a sinking ship. Within the next 5 hours, an entry point will be present. It’s time to glean for Q2, because after this the prices will hit an all time high and then go back down until July. A lot will assume now is too soon, but yesterdays price isn’t todays price. However, the cup and handle has presented its self. Now the next sign of equilibrium the price will make will be like a Nike check. Or a Wolfe wave. The eagle has left the nest. 2. API CRUDE OIL U.S.: anything under 5 is a sink. Forecast is in the -1.0 range. TOTAL VEHICLE CAR SALES: Elon and Twitter Don’t hire the bait just yet.
BITSTAMP:BTCUSDEducation
by Traliciaa
2
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CBOT:UB1!Education
by d-MR96nBa
13
XBTUSD The Theory of the Wolfe Wave : The theory of my Wave structure is based on a law of physics that for every action there is an equal and opposite reaction. This action/reaction often shows a definite rhythm with extremely valuable projecting capabilities to the trained eye. Many times however, little waves mix with larger waves and the waters become muddied. Sometimes everything is in synch and you will get a rogue wave effect similar to what occurs in the oceans of the world. These can be extremely profitable in the futures and stock market. On the following two pages, you will find the rules and the theoretical, bullish and bearish Wolfe Wave structures. Rules for Bullish Wolfe Wave Structure : Please not the odd sequence in counting, as you will see, it is necessary for the inductive analysis. By starting with a top we are assured of beginning our count on a new wave. The 2 point is a top. The 3 point is the bottom of the first decline. The 1 point is the bottom prior to point 2 (top), that 3 has surpassed. The 4 point is the top of the rally after point 3. The 5 point is the bottom after point 4 and is likely to exceed the extended trend line of 1 to 3. This is the entry point for a ride to the EPA line (1 to 4). Estimated Price at Arrival (EPA) is trend line of 1 to 4 at apex of extended trend line of 1 to 3 and extended trend line of 2 to 4. Estimated Time of Arrival (ETA) is apex of extended trend line of 1 to 3 and 2 to 4. Trend line of 1 to 3 and trend line of 2 to 4 must converge.
BITMEX:BTCUSD.PEducation
by Satoshi_Magnet
2
Top 10 Patterns (Wolfe Wave) #7Wolfe Waves:Example of a bullish Wolfe wave on 15 mn GbpChf chart. Can be both bearish or bullish and on any time frames. The key to recognizing the setup is symmetry. Ideally, waves 1-3-5 are established with very regular timing intervals between moves. The other key ingredient is that the wave 4 should revisit the price range established by waves 1-2 for the best results. Another way to describe the pattern is that it comes as a rising wedge / channel in an uptrend, or falling wedge / channel in a downtrend. Wave 5 is often a false breakout move beyond the bounds of the pattern. Unlike either bull or bear flags, the movement is in the same direction as the overall trend, with the overlapping waves giving signals that an impending reversal is taking shape. This pattern has different names, depending on the source - Larry Pesavento describes the pattern as "3 pushes to a top/bottom" and uses Fibonacci relationships to confirm the setup (waves 3 and 5 are 127% or 162% extensions of the previous pullback.) Jeff Cooper uses "Cooper 1-2-3 swing" nomenclature, and Linda Raschke likes to call this setup "3 indians". The unique quality about Wolfe waves, however, is the objective target projection from waves 1 -> 4. Despite the great explanation and examples provided on Bill Wolfe's site, I continue to get questions about how much I trust this setup. Very much so.
Education
by Anbat
How To Use Bearish Wolfe Wave SetupThe key to recognizing the Wolfe Wave setups is symmetry. Ideally, waves 1-3-5 are established with very regular timing intervals between moves. The other key ingredient is that the wave 4 should revisit the price range established by waves 1-2 for the best results. Another way to describe the pattern is that it comes as a rising wedge / channel in an uptrend, or falling wedge / channel in a downtrend. Wave 5 is often a false breakout move beyond the bounds of the pattern. Unlike either bull or bear flags, the movement is in the same direction as the overall trend, with the overlapping waves giving signals that an impending reversal is taking shape. This pattern has different names, depending on the source - Larry Pesavento describes the pattern as "3 pushes to a top/bottom" and uses Fibonacci relationships to confirm the setup (waves 3 and 5 are 127% or 162% extensions of the previous pullback.) Jeff Cooper uses "Cooper 1-2-3 swing" nomenclature, and Linda Raschke likes to call this setup "3 Indians". The unique quality about wolfe waves, however, is the objective target projection from waves 1 -> 4
Education
by Anbat
1
Wolfe Waves Example!This is not a forecast or a signal! it's just an example of an occasion which a pattern like Wolfe Waves worked well ! This chart has almost followed the rules of Wolfe waves , unless the first point is not exactly on the right place! 1st point: Start of the wave 2nd: First top of the channel 3rd: First low of the channel 4th: Second high of the channel regarding thee pivots! the next 2 pivots are useless since they are not a place to be considered as a Wolfe waves' points! 5th point: as it should be broke to channel! Open Trade: OT is breaking back to channel! Stop Loss: SL is just below the 5th point in long option and reverse of it, in short trades! I personally distinguish the pattern so late! but the Wolfe waves is a great way to find very profitable trades which is not so trending in these days
Education
by AliSignals
Advanced Wolfe Waves Part IWolfe Waves work! Here is GOLD Dec contract from early last week. Notice something very important. Wave 3 to Wave 4 is always an a-b-c wave. In this case its a measured move Entry had very limited risk. If point 5 overshoots, expect it to be no more than 1.27-1.5 x height of Wave 4 Look at the target, could go as low as 1410 - 20, which makes it >$150 move in gold! Trading one futures contract, that's $15,000 But there are opportunities along the way. There are always WWs inside of other WWs on smaller time frames as you will find in Part II These allow you to exit at the smaller WW target and then re-enter. See Part II
COMEX:GCZ2019Education
by Koch0617
3 kinds of Wolfe Wave Pattern adapt in Elliott Wave [Education]HI BIG PLAYERS, in this chart I show my research to Wolfe Wave pattern and how it match to Elliott Waves. My research has shown that there are basically 3 types of Wolfe Waves: 1. on the beginning of EW Leading Diagonal 2. on the wedge (most on correction waves) 3. on the end of EW Ending Diagonal In any testing: trading in Ending Diagonal is really high-risk because you trade against the trend! The easiest Wolfe Waves I done with Wedge Pattern. This have 2 advantages: - you trade direction is into the trend - correction waves are easier to identify in the Price Action I hope this education helps somebody. If you like this, you are invited to follow me. Kind regards NXT2017
NYSE:DISEducation
by NXT2017
1