Hello, let's take a closer look at Eliot's introduction of wave principle. Wave theory was founded by Eliot at the age of 63 in 1934. Eliot's wave theory is one of the most commonly used trend analysis tools. Group psychology is an important basis of this theory, and it is difficult for a light trading market to play its role. First, the theory of characteristics (1) consists of three aspects: waveform, ratio and time, and its importance decreases in turn; (2) The theory is not equally effective when applied to the average share price in the stock market; (3) Applying this theory to the commodity futures market; (4) The theory is based on Dow theory and traditional chart analysis. Second, the basic point (1) futures prices or stock indexes will rise and fall alternately. The scale of the trend is as big as 200 years, as small as a few hours. (2) From peak to trough or from trough to peak are waves, and all waves can be divided into two types: pushing (entering) waves and adjusting waves. They are the two most basic forms of price fluctuation: ① Push waves-waves in line with the general trend, which can be further divided into five small waves, represented by 1, 2, 3, 4 and 5 respectively. Among them, 1, 3 and 5 waves are low-order propulsion waves in the same direction. The second and fourth waves are lower-order adjustment waves, which are opposite to the forward direction. (2) adjustment wave-the waves at this stage are represented by letters A, B and C. (3) After the completion of eight waves (five ups and three downs), one cycle is completed and another eight wave cycle is entered. (4) The length of time will not change the shape of waves. Waves can be elongated and contracted, but the basic shape remains unchanged. (5) The mathematical basis of wave theory is odd number (Fibonacci series). Singular numbers are exponential series 1, 1, 2, 3, 5, 8, 13, 2 1 and so on. Its general formula is: an = an- 1+an-2 (see Fibonacci magic number column for details). (6) A push wave is followed by an adjustment wave, and the adjustment ratio is often 0.382 and 0.438+08 times. The primary goal of a wave propulsion is from the starting point of 1 wave to 3.236 times of 1 wavelength, and the final goal is from the end point of 1 wave to 3.236 times of 1 wavelength; The primary goal of wave adjustment is a wave length that is eight times from the starting point1.6/kloc-0, and the final goal is a wave length that is eight times from the ending point1.6/kloc-0. Three. Detailed Description of Eight Waves (1) 1 The beginning of the wave cycle is a part of the bottom shape, and the rise is usually the shortest market among the five waves. At this time, the buyer's strength is not strong, and the market continues to sell. (2) The second wave is often deep, almost eating up the 1 wave, which makes people mistakenly think that the bear market is not over yet. When this wave of market is close to the bottom, the market is reluctant to sell, the selling pressure gradually decreases, and the trading volume gradually decreases, so as to end. 2 The wave can stop at 1 above the bottom of the wave, and it can often form chart forms such as triple bottom, double bottom and inverted shoulder bottom. The retreat of wave 2 is always less than wave 1 amplitude 100%. (3) The third wave is often the largest and longest, and it will never be the shortest in the five-wave structure. At this time, investors' confidence has recovered, the volume of transactions has risen sharply, and breakthrough signals often appear. The motion of wave 3 will always exceed the end point of wave 1. (4) The shape of the fourth wave adjustment wave is complex and its structure is different from that of the second wave. It tends to have an inclined triangle trend, but its bottom will not be lower than the vertex of the 1 wave. This is one of the core principles of Eliot's wave theory. 4 waves play a significant supporting role in the future bear market. Usually, this round of bear market will not fall below the fourth wave formed by the previous round of bull market, which can be used to measure the farthest target of price decline. But there are exceptions. The four waves of the stock market cannot overlap with the 1 wave, which is an iron law. But in the futures market, it is not so strict. (5) The rise of The 5th Wave in the stock market is usually less than the third wave and often fails; In the futures market, the fifth wave is often the longest, and there may be extended waves. In The 5th Wave, many confirmatory indicators, such as OBV, began to lag behind the price changes. (6) Wave A is only a temporary phenomenon, and The 5th Wave actually has early warning signals. Most people think that the rising market has not reversed, and it is only recognized when the A wave has a five-wave structure. (7) The trading volume of B wave is not large, which is generally the escape line of old bulls and the second chance to establish new bears. Because it is a rising market, it is easy to mistake it for an upward trend and become a bull trap. Many people are trapped here. This wave may try to form a double top from the old high point, or even go down after crossing the old high point. (8) The C wave is extremely destructive, with great strength, great decline, long duration and overall decline. The appearance of wave C declared the real end of the upward trend. C wave falls below the bottom of A wave, forming a selling signal. Connecting the bottom of wave 4 with wave A in a straight line sometimes forms the shape of head and shoulders. The wave number sequence of waves obeys Fibonacci sequence. 4. Whether the wave structure should be divided into 5-wave structure or 3-wave structure depends on the upper wave direction: (1) When the moving direction is consistent with the upper wave direction, it is subdivided into 5-wave structure; (2) When the motion direction is opposite to that of the previous wave, it is subdivided into three-wave structure. This is of decisive significance to the correct application of wave theory. V. Characteristics of rising waves (1) It is not uncommon to see the prolongation of main waves in the rising trend: ① 1 wave prolongation-the least common; (2) the third wave of expansion-common in the stock market; ③ The 5th Wave extension-common in futures market; (4) unclear extension-a nine-wave structure with five main waves, characterized by the equal length of the five main waves. ⑤ 1, 2, 3, only one rising wave can be extended, and the other two non-extended waves have the same time and amplitude. (2) Multiply wave 1 by wave 1.6 18 and add it to the bottom point of wave 2, then the minimum goal of wave 3 can be obtained. (3) 1 wave multiplied by 3.236, respectively, added to the top and bottom of 1 wave, which is roughly the maximum and minimum target of 5 waves. (4) If the wave 1 and 3 are approximately equal, it is expected that the wave 5 will be prolonged. The target value is 1 wave bottom to 3 wave top length, multiplied by 1. 18, and added to 4 wave bottom points. Sixth, the characteristics of the adjustment wave (1) The adjustment wave will never appear in the form of five waves, but belongs to the structure of three waves. (2) There are four types of adjustment waves: ① sawtooth type (5-3-5 type), with wavelets appearing in 5-3-5 sequence. Include single sawtooth, double sawtooth and triple sawtooth. Each of the double serrations and triple serrations is separated by one or two intervening "three waves". ② Platforms (3-3-5 type), and wavelets appear in 3-3-5 sequence. Include common platform shape, diffusion platform shape and homeopathic platform shape. ③ Triangle (type 3-3-3-3-3), and wavelets appear in the order of 3-3-3-3. Triangles include: rising triangle, falling triangle, symmetrical triangle and diffusion triangle. Often appear in the fourth wave, and always before the last wave; It can also appear in b waves. ④ Combined type. Comprise a double triple-wave structure and a triple-wave structure. In most cases, the combined adjustment wave is horizontal. (3) If it is the usual 5-3-5 seesaw adjustment, then the C wave is often equal to the A wave. (4) Multiply the length of a wave by 0.6 18, and then subtract the product of the bottom point of A to estimate the length of C wave. (5) In the case of 3-3-5 platform shape adjustment, wave B may reach or exceed the apex of wave A; At this time, the length of C wave is equal to 1.6 18 times the length of A wave. (6) In the symmetrical triangle adjustment, each subsequent wave is about 0.6 18 times of the previous wave. thank you