Question of the Week: 4/17/2006
What is the most important thing in determining wave structure and where patterns begin and end?
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With no hesitation, the most important thing to study in determining where one pattern ended and a new one began is wave behavior. This is a NEoWave concept and a very important advancement to orthodox Elliott Wave. Elliott Wave focuses on the structure of price action first, whereas NEoWave focuses first on the behavior of price action and structure second.
For example, when a new pattern begins under NEoWave theory (except when following an Expanding Triangle), a market should always move further and faster than any previous move in the same direction during the previous formation. If that requirement is not met, it is nearly certain a pattern conclusion of one larger degree has not occurred.
The requirement for every pattern to produce specific, post-pattern price action is a NEoWave concept that dramatically enhances the accuracy of wave theory and substantially reduces the need for constant count revisions - a common phenomenon under orthodox Elliott Wave.
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