When it comes to using Elliott Wave as a trader, we consider having access to automated Elliott Wave counts generated by a computer as critical for 2 very important reasons. The first is that it is a pure time saving benefit that is going to allow you to cover a lot more ground and find many more trading opportunities. The second is that counting Elliott Waves manually is a very subjective exercise which makes having a consistent approach difficult. Conversely having a computer do it for you means that you can be confident in the consistency of the application of the rules and therefore build your trading system with more confidence! Let’s take a look at each point in more detail.

#1 – Software Can Do the Work You Can’t

There are approximately 8000 different stocks and ETFs listed in U.S. markets if you are hoping to use Elliott Wave as part of your analysis method there is simply no way that you could manually update Elliott Wave charts for all of these on your charting software! However computerised Elliott Wave software, like ProfitSource, can do this job for you. Further more ProfitSource can do this without you even looking at the charts. The software can manually scan all stocks, not just in the US but worldwide, and alert you to various conditions. You want to know which stocks are in Wave 3?… Which are having a Wave 4 pull back? … software can let you know at the touch of a button.

#2 – Consistent Elliott Wave Counts

If you know anything about Elliott Wave, you will realise that there are a very large number of rules and guidelines to be aware of when applying counts to a chart. You will also realise that at any particular time there are multiple Elliott Wave counts that are valid. Consequently, no matter how we try, as human beings we bring our own subjectivity when trying to label Elliott wave counts on any chart. Having a software program do the labelling for you eliminate this problem!

Consider these charts to the right. The top chart shows Price action over a period of time for a certain stock. Each pivot point, being a point where the stock has changed trend, has been labelled with a letter from A through O.

The next three charts show how different combinations of these available pivot points have been used to label Elliott Wave Impulse patterns. Each one of these charts is exactly the same however a basic impulse pattern has been drawn in three different ways using different points. Each one of these impulse patterns is valid!

As a human being, which chart would you select?… The problem is not whether you have selected the correct chart or not because all of these accounts are valid. The problem is when you look at the next chart will the way in which you apply the count be consistent. The reason that this is important is because when you are building a trading system, you need to know that the signals you are receiving a consistent so that you can have confidence that the Track Record you are building up is repeatable. In other words can you rely on your trading system to work the same way every time? If a computer is creating the Elliott wave count and therefore setting up the trading opportunities, you can be very confident that the way in which these opportunities are found are the same every time!

So the real important point to take away here is this … don’t get wrapped up in trying to get the perfect Elliott Wave count. As a trader it is more important to have a repeatable consistent approach to generating Elliott Wave counts. One that that you can rely on for identifying opportunities to make trading profits!

Available Pivot Points Labelled

Why Computerised Elliott Wave Counts Matter

Possible Impulse Count #1

Why Computerised Elliott Wave Counts Matter

Possible Impulse Count #2

Why Computerised Elliott Wave Counts Matter

Possible Impulse Count #3

Why computerised Elliott Wave Counts matter