After learning about the Predictive value of Elliott Waves I asked Jody Samuels, my trainer and mentor,what she recommends for Elliott Wave counting. She referred me to a software that I believe can help traders, in all markets, Crack the Elliott Wave Code.
Instantly, I realized the value of MotiveWave. Here’s my review.
What is so important about counting Elliott Waves?
As I described in my post, Elliott Waves – Patterns in Chaos, R.N. Elliott, in the 1930s, saw patterns in chaos in the financial markets. He identified a basic 8-wave fractal pattern that recurs over all time frames. He taught that market movements were the result of mass psychology and the collective emotions of traders. His discovery is now known as The Elliott Wave Principle. Many traders use the Elliott Waves to anticipate changes in market direction. Mr. Elliott’s basic 8-Wave Pattern, is shown below:
How valuable would it be if you could know where the market is in the Elliott Wave sequence? What if you could know when Wave 2 was finishing and the market was about to enter Wave 3? R.N. Elliott taught that Wave 3 is often the longest and most profitable wave. He called Wave 3 “A wonder to behold.”
Elliott Waves and Fractal Sub-Waves
While reviewing MotiveWave software, I saw how it can quickly identify primary waves and also the fractal sub-waves. In review of “The Fractal Nature of the Market” in Elliott Waves – Patterns in Chaos the price charts show a combination of waves of lower and higher degrees. Below, you will see that a Wave 1 & 2 on a daily time-frame subdivide into waves of lower degrees that can be seen on the hourly time-frame and 15 minute time-frame. In the illustration you will notice that I superimposed the three time-frames to demonstrate the fractal nature of the market. MotiveWave identifies and labels waves of various degrees.
MotiveWave is a professional suite of tools that makes trading and market analysis simple. By integrating with your existing broker, MotiveWave lets you have the best of both worlds. You can choose your own broker – one that best meets your needs while using, what I believe are, the most innovative trading and analysis tools available.
MotiveWave is a unique combination of charting tools, Elliott Wave Counting tools, Gartley tools, Gann tools, and a fully-featured trading platform. Their instructional videos fully explain the key features and functions.
The MotiveWave Console can easily be modified to reflect any of 20 layouts. I liked modifying the screen to allow for the most possible chart space. I also liked the idea of placing two charts side by side to view two time-frames. Here is an image of one version of the “Console.”
Elliott Wave Rules
Mr. Elliott specified several rules in his Wave analysis. These rules have been programmed into the MotiveWave software and the best possible wave counts are displayed- within the rules. When you manually draw a wave pattern the software will remind you, in a display box, of any rules that have been broken.
Multiple Fibonacci Tools
There are more far more Fibonacci tools than I ever knew existed. You simply grab and drag one onto the chart screen and place it where you want it. By the way, when you reduce the time-frame the Fibonacci projection remains accurately placed on the lower time-frames.
Here is what it looks like on a MotiveWave chart. Notice how the price found support at 38.2% and 50%. I also found that you can do a number of Fibonacci projections and assign them different colors. This allows you to identify Fibonacci clusters.
Studies- Indicators and Tools
I found over 250 indicators and tools. They are under the “Studies” tab. Here are a few moving averages and indicators I use:
Here is a screen shot of the “General Components” tab:
There are Components Tabs for Elliott Wave, Gann and Gartley Patterns.
Another feature I liked is that you can draw a trend-line on any time-frame and it carries over to lower or higher time-frames. For example, if you draw trend-line on a 45 minute chart and then reduce the time-frame to 10 minutes the line will remain true, as follows:
Full Chart Example of EUR/USD
According to Elliott Wave Analysis after the completion of a wave 3 we can anticipate a downward wave 4 correction followed by a 5th wave upward move – in the direction of the trend. (The wave 4 and wave 5 projections are mine – based on a basic 5 wave impulsive move.)
Inside Candlestick Bars
It is really difficult to bring this product review to a close when there are so many valuable features and benefits to point out. I just discovered something, a few days ago, that I believe just doubled the value of this software. This functionality must be a recent addition or an unadvertised bonus because I did not learn about it on their Web site or in the videos. Although this does not directly relate to Elliott Waves it appears that these “Inside Bars” are often found at changes in the Elliott Wave Patterns. (Just another tool to help traders anticipate directional changes in the market)
By going into Chart Settings/ Bar Settings/ Bar Scheme I found that we can automatically show “Inside Candlestick Bars” on the charts. On my charts “Inside Bars” are displayed in black.
An “Inside Bar” signifies market indecision and that the market could be about to change direction. The current bar’s full trading range is within the previous bar’s trading range. On the MotiveWave image below notice that more often than not– the inside bar came just prior to a major change in market direction. I showed the stochastic oscillator because the inside bars are more relevant in over-bought conditions when they are at the top (suggesting a bearish move down) and over-sold condition when they are found at the bottom (suggesting bullish move up).
UPDATE on Inside bars:
I just learned something else. I designated my bullish candles in blue and bearish ones in red. I mentioned that MotiveWave identifies “Inside bar Candles” in black. I just noticed that the green candles are “Outside Bar Candles.” They are similar to the engulfing patterns. Do some research on them and if you find them helpful use them on the MotiveWave charts.
What about Customer Service and Tech Support?
I have a feeling that we all are concerned about support. The MotiveWave training videos answered most of my questions. I was riveted to them. I did have a few specialized questions and I called Customer Service. They were professional and thorough – and patient. I am very comfortable with the quality of their support. Here is a sample of their video training. I found them to be extremely well done.
I enjoyed reviewing the MotiveWave software. And, since have become a satisfied customer and user. It was very difficult bringing this post to an end because there is so much to say about MotiveWave. The best way to learn is to take them up on their trial offer and explore it for yourself- like I did.
Although the software does an excellent job of correctly identifying Elliott Wave counts it is highly recommended that traders not trade blindly from the software. But, instead, traders are encouraged to learn the basics of Elliott Waves. This software can speed that learning process greatly.
I believe this groundbreaking software can help traders crack the Elliott Wave code. When used correctly MotiveWave has the potential of greatly improving our trading skills by helping us to anticipate market reversals.
If R.N. Elliott could have only known that this technology could eventually be developed he would have been impressed and proud.
Congratulations to the MotiveWave staff and developers for a job well done!
to Turbocharge Your Trading