The Broad Concept - Elliott Wave Principle

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In The Elliott Wave Principle — A Critical Appraisal, A. Hamilton Bolton made this opening statement:
As we have advanced through some of the most unpredictable economic climate imaginable, covering depression, major war, and postwar reconstruction and boom, I have noted how well Elliott’s Wave Principle has fitted into the facts of life as they have developed, and have accordingly gained more confidence that this Principle has a good quotient of basic value.
In the 1930s, Ralph Nelson Elliott discovered that stock market prices trend and reverse in recognizable patterns. The patterns he discerned are repetitive in form but not necessarily in time or amplitude. Elliott isolated five such patterns, or "waves," that recur in market price data. He named, defined and illustrated these patterns and their variations. He then described how they link together to form larger versions of themselves, how they in turn link to form the same patterns of the next larger size, and so on, producing a structured progression. He called this phenomenon The Wave Principle.
Although it is the best Forex Signals tool in existence, the Wave Principle is not primarily a Forex Signals tool; it is a detailed description of how markets behave. Nevertheless, that description does impart an immense amount of knowledge about the market’s position within the behavioral continuum and therefore about its probable ensuing path. The primary value of the Wave Principle is that it provides a context for market analysis and FREE Forex Signals . This context provides both a basis for disciplined thinking and a perspective on the market’s general position and outlook. At times, its accuracy in identifying, and even anticipating, changes in direction is almost unbelievable. Many areas of mass human activity display the Wave Principle, but it is most popularly used in the stock market. Truly, however, the stock market is far more significant to the human condition than it appears to casual observers and even to those who make their living by it. The level of aggregate stock prices is a direct and immediate measure of the popular valuation of man’s total productive capability. That this valuation has form is a fact of profound implications that will ultimately revolutionize the social sciences. That, however, is a discussion for another time.
R.N. Elliott’s genius consisted of a wonderfully disciplined mental process, suited to studying charts of the Dow Jones Industrial Average and its predecessors with such thoroughness and precision that he could construct a network of principles that reflected all market action known to him up to the mid-1940s. At that time, with the Dow near 100, Elliott predicted a great bull market for the next several decades that would exceed all expectations at a time when most investors felt it impossible that the Dow could even better its 1929 peak. As we shall see, exceptional stock market forecasts, some of pinpoint accuracy years in advance, have accompanied the history of the application of the Elliott wave approach.
Elliott had theories regarding the origin and meaning of the patterns he discovered, which we will present and expand upon in Chapter 3. Until then, suffice it to say that the patterns described in Chapters 1 and 2 have stood the test of time.
Often one will hear several different interpretations of the market’s Elliott wave status, especially when cursory, offthe- cuff studies of the averages are made by latter-day experts. However, most uncertainties can be avoided by keeping charts on both arithmetic and semilogarithmic scale and by taking care to follow the rules and guidelines as laid down in this book. Welcome to the world of Elliott.