"No warning can save people determined to grow suddently rich" - Lord Overstone

  • 10 hours Major League Baseball Turns To Blockchain Tech
  • 1 day Institutional Investors Hold A Lot More Crypto Than You Think
  • 1 day U.S. Treasury Yields Could Be About To Break Out
  • 2 days Tesla Stock Stumbles On Model 3 Cancellations
  • 2 days Yuan Rebounds At The Expense Of The U.S. Dollar
  • 2 days Iraq Unplugged: No Internet, No Protests, No Money
  • 2 days The Tariff War Could Spark A Debt Crisis In China
  • 2 days Gold Selloff Continues As Dollar Climbs Higher
  • 2 days Gold Investors In A Frenzy Over Sunken Russian Warship
  • 2 days The New King Of Electric Cars
  • 3 days BlackRock Goes Bitcoin
  • 3 days U.S. Banks See Best Earnings Report In Years
  • 3 days The Case For Gold Is Not About Price
  • 3 days Stock Market Sentiment Turns Bullish
  • 3 days What Is Bitcoin Really Supposed To Be?
  • 3 days The Surprising Media Giant Taking On Netflix
  • 3 days Cybersecurity Stocks Are Red-Hot As Election Looms
  • 4 days Americans Grow Weary Of U.S. Trade Policy
  • 4 days What Putin Really Wants From Trump
  • 4 days Europe’s EV Sales Growth Is Slowing
Chinese IPO Fervor Slows As Xiaomi Disappoints

Chinese IPO Fervor Slows As Xiaomi Disappoints

The Chinese IPO space was…

Stock Market Sentiment Turns Bullish

Stock Market Sentiment Turns Bullish

Quarterly earnings reports have lifted…

Netflix Shock Hits FAANG Stocks Hard

Netflix Shock Hits FAANG Stocks Hard

Netflix released its surprising second…

Elliott Wave International

Elliott Wave International

Elliott Wave International

Elliott Wave International (EWI) is the world's largest market forecasting firm. EWI's 20-plus analysts provide around-the-clock forecasts of every major market in the world via…

Contact Author

You Asked, We Answered in our Latest 'Video Mailbag'

March 2017 Episode

In our latest "Video Mailbag," Robert Kelley and Steve Craig, two of our global analysts, sit down to answer questions submitted by viewers like you.

[Editor's Note: The text version of the video is below.]

Questions answered in this episode:

  • "What is the World Stock Index?" @ 0:13
  • "Usually people are familiar with Elliott Waves on an individual country index. I'm wondering if Elliott Wave patterns are as clear and compelling on a basket such as the World Stock Index?" @ 0:40
  • "After a fourth wave triangle, how do I estimate the length of a potential fifth wave extension?" @ 1:31
  • "Can wave 3 be more than 2.618 times the length of wave 1?" @ 2:08
  • "Is there a limit to the number of subwaves?" @ 3:11

Alexandra Lienhard: Welcome to this month's episode of ElliottWaveTV Viewer Mailbag. Robert Kelley, who edits Elliott Wave International's US Intraday Stocks Pro Service with Robert Kelley sat down with us this month to answer a couple of questions. The first one comes from Benjamin from St. Louis, Missouri, who asks, what is the world's stock index?

Robert Kelley: Well, the Dow Jones Global World Stock Index is made up of 47 different country stock indexes. And it allows -- it represents 95% of what's available to invest in around the world. So it's a really broad measure of world equity prices.

AL: Stan from Geneva, Switzerland has a follow-up question. Usually people are familiar with Elliott Waves on an individual country index. I'm wondering if Elliott Wave Patterns are as clear and compelling on a basket such as the world's stock index?

RK: Actually, yes, it's surprisingly very good representation of mass psychology. It's probably the ultimate mass psychology, considering what it's covering. And these patterns definitely have very clear Elliott structures. It counts pretty well, and it kind of smooths out-- because it's so a large basket, it kind of smooths out some of the noise that might occur in a day-to-day situation in a particular market.

AL: Steve Craig, Elliott Wave International's Chief Energy Analyst and editor of EWI's Energy Pro Services also took some time to answer a couple of mailbag questions. Next we have Lynn from San Francisco, California, who'd like to know, after a fourth wave triangle, how do I estimate the length of a potential fifth wave extension?

Steve Craig: Fifth wave extensions are often in Fibonacci proportion to the net distance traveled of waves one through three. For example, multiples of 1.618, 2.0, 2.618. Now, in commodities, bull markets at the larger degree of trend-- for example, primary or cycle-- fourth wave triangles can often precede extended blowoffs.

AL: Our next question is from Sameer from Mumbai who asks, can wave 3 be more than 2.618 times the length of wave 1?

SC: Within impulse waves and expanding diagonals, it is possible for wave 3 to be more than 2.618 times the length of wave 1. There's no set limit on the length of wave 3 relative to wave 1 in those situations, as long as none of the Elliott wave rules are broken. In impulse waves, when wave 3 is extended, you should expect wave 5 to be related to wave 1 by equality, or the Fibonacci ratio 0.618. In contracting diagonals, wave 3 is always shorter than wave 1. And in expanding diagonals, wave 3 is always longer than wave 1. In all cases, wave 3 can never be the shortest wave.

AL: And today's last question comes from John from Pensacola, Florida, who asks, is there a limit to the number of subwaves?

SC: There is no set limit on the number of subwaves. From a measurement standpoint, your only limitation will be the extent to which you are able to identify waves in smaller timeframes given the data that's available.

 


Learn the Why, What and How of Elliott Wave Analysis

Watch the Elliott Wave Crash Course, FREE

This three-video series demolishes the widely held beliefs about investing and provides a basis for using Elliott wave analysis as an alternative in your own trading and investing decisions.

Access your free resource

This article was syndicated by Elliott Wave International and was originally published under the headline You Asked, We Answered in our Latest "Video Mailbag". EWI is the world's largest market forecasting firm. Its staff of full-time analysts led by Chartered Market Technician Robert Prechter provides 24-hour-a-day market analysis to institutional and private investors around the world.

 

Back to homepage

Leave a comment

Leave a comment