There are certain people that make a living out of Forex trading. It’s a great way to make money easily. Today almost 60% of the American population invests money on trading platforms and most of them earn more than enough to get by. At first is seems complicated but as the time passes you learn that it is not as complicated as it seems and all you need is intuition, information and some money to get you started.
Investing in Forex is not to different than investing in the stock-market, in fact most platforms that allow Forex trading also have stock exchange. The risk is present like in any business but with the right information and intuition you can find you can make a decent living out of it without having to do anything. But before you dive head first into the trading world you have to learn how to read indicators like Elliott waves indicator.
Ralph Nelson Elliott had made reference to tree key aspects in the movement of the prices: pattern, ratio and time. The indicator makes reference to the models or formations that appear as waves, while the ratio is used to measure the waves. To use this method in day to day trading you would have to determine the main wave or the super-cycle, adopt a long position and then sale or get into a short stand, because the pattern runs out of “fuel” and a switch is imminent. In its basic form the Elliot waves indicator affirms that any movement on the market follows a repetitive rhythm of five waves in the direction of the main trend and three waves to correct the price. This is called a 5- 3 movement. The first waves are usually marked as 1-2-3-4-5 and the retreat ones are marked with a-b-c. In the advance faze, waves 1,3 and five are called impulse waves and they are moving in the general direction of the trend while waves 2 and 4 are called corrective waves. After the five wave advance is finished a correction of 3 noted as a-b-c called corrective waves begins. In the corrective waves “a” and “c” are going in the retreat while “b” is heading in the opposite direction.
The Elliott Waves indicator classifies the waves depending on the duration of the cycle varying from a Grand Super cycle that can be extended on to decades to smaller cycles that won’t last more than a few hours. With all of these said the eight wave cycle remains constant.
