Automated Elliott Wave Pattern recognition with Fib Relationships

(Last Updated On: October 24, 2011)
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Automated Elliott Wave Pattern recognition with Fib Relationships

Has anyone managed to develop any software that can recognize the standard elliott wave patterns and generate trades based on the highest probability next wave?


Yep, in my case I did not get any profitable results. I tested on stocks, a time frame was EOD. BR.

Absolutely – please look at – I use the EOD version and works very very well for all markets.. I trade futures.


Just consider the opposite.

“neural network model perform better than the human brain at recognizing “sequential signal patterns” such as stock prices, whereas the human brain is better at recognizing “parallel signal patterns”—the human eye can easily tell a picture of a tiger from a picture of a cat.”

Why should you use mechanical Elliott wave to fit the market into something that obviously it is not. For example R. Miner one of the most prominent ellioticians recognized that most of the time the market does not allow an Elliott waves fit. So if you ask an algorithm it will force it to give you a solution and the solution guess what would be …

On the other hand the market very often produce nice trends that can be analysed with Elliott wave pattern structure. And there is the catch.

Use you human pattern recognition abilities to find a good trend. And then train on this Elliott wave pattern your algorithm whatever it can be.

For more read here.



what does the success/failure ratio look like?



We made some trials but to tell you the truth I did not test it in a professional way.



Like most successful long term systems, win ratio is low at 30%. You can tweak in many different ways. Using data 1990-2010 on 12 futures markets winratio 30%, max DD = 23.5 R where R = amt risked per trade. After 20 yrs total profit = 303 R.

For e.g. if R = $3K during those 20 yrs, max DD = $70K (yes quite high), but you would have made 303R = $909000. I have been forward testing for 2 yrs and plan to go live next October. Advantage with EOD is you don’t have to follow intraday charts.



you can also get the real time version – there are pluging for Tradestation, Ninjatrader and eSignal. I used Ninjatrader realtime for a while – experiment with Fx or futures in different timeframes (3min – 240mins). The founders frequently have webinars where they show you live trades. Just sign up on the website..



i have not used it, but i think Metastock has a plug-in on EW.



Recognia has just released Elliott Wave analysis in the Bloomberg Terminal. Other brokers will likely soon offer this capability. Agreed with John_fx re tigers and cats, but automated recognition allows the delivery of candidates for the human eye that the human eye would otherwise never encounter.



Maybe it is the same process as pattern recognition scanner autochartists offered by interbank fx. well it does not replace the human but it scans all the market saving you a lot of work.

But still when you identify a reliable elliott pattern, consult another model specially trained for this elliott wave market segment.

Any was this is just an idea.



NOTE I now post my TRADING ALERTS into my personal FACEBOOK ACCOUNT and TWITTER. Don't worry as I don't post stupid cat videos or what I eat!
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About caustic

Hi i there My name is Bryan Downing. I am part of a company called QuantLabs.Net This is specifically a company with a high profile blog about technology, trading, financial, investment, quant, etc. It posts things on how to do job interviews with large companies like Morgan Stanley, Bloomberg, Citibank, and IBM. It also posts different unique tips and tricks on Java, C++, or C programming. It posts about different techniques in learning about Matlab and building models or strategies. There is a lot here if you are into venturing into the financial world like quant or technical analysis. It also discusses the future generation of trading and programming Specialties: C++, Java, C#, Matlab, quant, models, strategies, technical analysis, linux, windows P.S. I have been known to be the worst typist. Do not be offended by it as I like to bang stuff out and put priorty of what I do over typing. Maybe one day I can get a full time copy editor to help out. Do note I prefer videos as they are much easier to produce so check out my many video at