Elliott Wave Theory

A technical analysis market timing strategy published by Ralph Nelson Elliott. Elliott Wave Analysis is based on repetitive wave patterns and the Fibonacci number sequence. The theory asserts that the stock market moves up in a series of five waves and down in a series of three waves, predicting price movements on the basis of historical price wave patterns and their underlying psychological motives. Elliott Wave differs from other cyclical theories in that it suggests no absolute time requirements for a cycle to complete. See also: Robert Prechter.