The Elliott Wave Theory is based on the fact that when you get a large group of people together, they act like a herd and less like an individual.
A herd mentally occurs when people are influenced by their peers to adopt certain behavior and follow trends, without centralized direction.
This mentally follows a predictable pattern that can be identified in anything that involves a large group of people such as sporting events, religious gathering, everyday decision-making, judgments and opinions.
Elliott applied this concept to the stock market. So The Elliott wave theory states that the market is fractal in nature, it forms the same patterns that are observed on longer degree charts on smaller timeframe as well.
The theory claims that the market action among participant traders produce wave patterns and trends, defined by Elliott as the physical sign of mass psychology.
A herd mentally occurs when people are influenced by their peers to adopt certain behavior and follow trends, without centralized direction.
This mentally follows a predictable pattern that can be identified in anything that involves a large group of people such as sporting events, religious gathering, everyday decision-making, judgments and opinions.
Elliott applied this concept to the stock market. So The Elliott wave theory states that the market is fractal in nature, it forms the same patterns that are observed on longer degree charts on smaller timeframe as well.
The theory claims that the market action among participant traders produce wave patterns and trends, defined by Elliott as the physical sign of mass psychology.
