The Power of Counting Bars & Waves

Counting Bars

Over and over again, i am amazed at the repitition when i count the number of bars in a trend. the count frequently is one of the following numbers: 3,5,8,13,21,34, or 55. These numbers are members of set a numbers called the fibonacci number of sequence. take any chart, and use straight edge to mark the trends. count the number of bars in each trend and label the trend line with the bar count.

Each chart will have a characteristic that starts to appear. I have seen chart that with regularity move up and down for either 5 or 8 trading days, and then reverse direction. This tip can be used to develop patience. And know with greater accuracy on which day the trend top or bottom will put in place. (Esignsoftwere)

Counting Waves

Underlying forces cause markets to move work in ways that create identifiable pattern, or a series of waves, and each impulse is followed by a correction wave. The theory named after Ralph Nelson Elliot, is Basically expressed that there will be 5 waves in the main trend, followed by 3 waves in the corrective reaction.

Keep it simple. Look for trends with 5 waves and correction with 3 waves. If I see the pattern, my confidence is increased that the current price movement is due for a reversal. Also look at longer term daily,weekly and monthly charts to consider the direction of the security in its bigger picture. Trade with the trend and use corrections as opportunities to join the direction of the main trend.