eWaves - getting into the big moves early

One of the most asked questions that I receive - understandably so - is: "How do I get into the Wave 3 at the start?".  So I thought I'd take a quick look at last weeks action and the first chart I checked was EU; and what a nice example it was.

I've used my latest version of eWaves for this as it provides back-testing capabilities.  In case you're wondering, I hope to release it sometime this year.

First off, a terrific opportunity presented itself at the bottom of the W4 back on the 8th Feb, to target TZ1 more than 240 pips away.
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How could we have got in at the start of W3 at the back end of January / early February?

eWaves provides some clues, supported by one of the most fundamental Elliott Wave rules, with a sprinkling of price action and trend line breaks.  The picture below shows how the W1 and W2 could have been identified to jump in early on W3.

• Previous resistance areas being taken out by the Wave 1
• Wave 2 not retracing past the start of W1
• Hidden divergence on the eWaves histogram
• The Wave 2 was a simple ABC correction back into the most recent demand zone
• The down-trend line for the W2 eventually broken, giving a opportunity for traders who missed the demand zone entry to jump in.  (the start of the W2 would have made a nice trade by the way - upside rejection from resistance)​

There were even some nice clues that would have got you into the start of W1 - just look to the left of it to see how price had moved up from the low - a clear demand zone was formed. A truncated eWaves 5 followed (that new eWaves looks out for), so we had a big move up, that took just 5 bars to complete, followed by a 26 bar retrace - where would you think the interest lies? Admittedly, the previous big bar down was a bit of a worry.

Getting in at the start of a W3 can be relatively easy - price usually gives you ample clues and the most fundamental of Elliott Waves rules provides for logical tight stop loss placement.