Hi Elliott Waver, In 1984, EWI Founder Robert Prechter won the United States Trading Championship with a then-record 444% return. After Bob won, many subscribers asked for a list of tips, or even a breakdown of his trades, to try and replicate his success. Bob knew that wouldn’t help, so instead, he created a short list of “rules” that every trader needs to be successful. Here’s one: |
A Method I mean an objectively definable method. One that is thought out in its entirety to the extent that if someone asks you how you make your decisions, you can explain it to him, and if he asks you again in six months, he will receive the same answer. This is not to say that a method cannot be altered or improved; it must, however, be developed as a totality before it is implemented. A prerequisite for obtaining a method is acceptance of the fact that perfection is not achievable. People who demand it are wasting their time searching for the Holy Grail, and they will never get beyond this first step of obtaining a method. I chose to use, for my decision making, an approach which was explained in our book, Elliott Wave Principle. I think the Wave Principle is the best way to understand the framework of a market and where prices are within that framework. There are a hundred other methods which will work if successful trading is your only goal. As I have often said, a simple 10-day moving average of the daily advance-decline net, probably the first indicator a stock market technician learns, can be used as a trading tool, if objectively defined rules are created for its use. The bad news is that as difficult and time consuming as this first major requirement can be, it is the easiest one to fulfill. |
