Читать книгу Supertiming: The Unique Elliott Wave System - Robert C. Beckman - Страница 21

Well, that’s Elliott’s “pure”… now let’s see if I can simplify it a bit. Elliott’s basic configuration was the five-three pattern consisting of five waves in an overall upward direction and three waves encompassing a downward move. At this stage, for the sake of simplicity, we will act on the assumption that the five wave pattern is applicable to bull markets, bear markets having three waves. (No point in dealing with the variations and exceptions to the rule until we master the basic rule.) As I have demonstrated to members of my classes who have studied the Elliott Wave Principle, action based on this simple rule only will undoubtedly improve the performance of most investors. For example, there were several investors who were fortunate in having the foresight to purchase shares in the London Stock Market in January of 1975. Many of these investors retired from the market too early in June of 1975 when only one wave of the bull market had been completed. Many more liquidated shares between February and March of 1976 when only the first, second and third waves of the bull market were completed. Students of the Wave Principle would still be holding their shares pending completion of the fifth wave. They will liquidate their holdings when this fifth wave is completed and not enter the market again until three complete waves of a bear market take place. The bear market that follows the 1975-7? bull market will be interspersed by an important rally, such rally being “corrective wave 2” of the three-wave bear market pattern to be expected following the bull market. Many investors will be tricked into re-entering the market when this rally takes place under the misapprehension that the bear market is over. Students of the Wave Principle will stand their ground recognising that the first rally in a bear market is often very deceptive, and realising that a third and final wave will be necessary to complete the next bear cycle when it comes.

In its purest form, the five-wave pattern is the bull market rhythm and the three-wave pattern is the bear market rhythm. The five-wave pattern entails three upward thrusts (waves 1, 3 and 5) and two recoils (waves 2 and 4). The three-wave pattern entails two downward thrusts and one corrective recoil in the opposite direction… a rally in a bear market.

The basic five-wave phenomena is best seen in Figure 4.

Figure 4

Rarely is the stock market as symmetrical as appears in the diagram, therefore treat the illustration as a guide only. We have a bull trend consisting of five waves, three in the direction of the main trend and two smaller waves which move counter to the main trend. As explained, the three waves in the direction of the main trend are “impulse waves” and the two smaller waves which run counter to the main trend are “corrective waves”. Wave 1 is “corrected” by Wave 2. Wave 3 is “corrected” by Wave 4.