Here’s a 5-3 Elliott wave (maybe) in the wild – the pros would call it a subminuette, on a 1 hour chart, range of 40 pips.

Is it an Elliott wave? Sure looks a bit like one should look.
I know a guy who goes to his charts, watches, waits and then says “Ha! Elliott wave.”
He’s seen the first 5 waves and he’s going to pile in long on the inevitable bearish.

MACD, no, Bollinger bands, no – he doesn’t seem to pay much attention to preceding resistance points, or anything much, the shape is enough for him.

And he seems to do ok, in that he’s still there and an active trader.

So are these mistaken tactics (there’s certainly no strategy here)? How many times does a chart that looks all the world like a classic Elliott wave coming along, only veer off somewhere else completely – even without any news to break up the picture.

I’d reckon don’t be too slavish to a single analytical tool – this is never going to be an surefire way of doing things, whether you buy into the full psychological theory of Elliott or not.

But then he would say – all those little traders out there (and all the bots), will have picked up on it, they’re going to turn it into a 5-3. They’re going to do the job for me. Self-fulfilling. I’m the one who’s actually in tune with the market.

What do you reckon? Remember it’s a seriously micro example, on a 1 hour chart…