As I count waves, I realize one thing; counts are based on some assumptions on the lengths and shapes of price action, that is, there are lots of "no, this can't be the end of wave 5; this is unproportionate" without relying on any EW rule or guideline. Slopes of waves, too, give important insight in EW practice. I say, then, there is more fundamental market theory which is at work pre-reflectively when EW seems to be at work in the front page. So, why not focus that aspect?
Base lines act as a support or resistance in two different points. For both of the points, the line should act either as support or as resistance. The yellow line in the above chart is an example.
Key lines are those lines which touches a reversal point three times. The blue line above is a key line.
Third type of line that I want to point out here is the slope-determining line. Those lines can be inner slope-determining lines (ISD lines) or outer slope-determining lines (OSD lines). Those lines determine the character of an entire polywave, that is, they indicate a major tendency of a collection of consecutive waves which themselves can have different sizes and directions. The slope of the green lines above, as an example, can be seen as the signature of the whole price action in 2015. Those green lines are ISD lines, meaning that the points where they touch reversals in the price action exist only within the price action of which the lines are signature. Other slope-determining lines may be entitled OSD lines. All those lines may also be called signature lines. Signature lines may or may not be a key line or a base line.
The market is a fight between those lines, and trying to figure out what happened in the fight may help us anticipate the future of the fight. In order to have a right perspective, I believe we should import the concept of "degree" to our theory. Here, for instance, the blue line exists in one larger degree than the other lines, and all the fight can be seen as evolving around it.
Base lines act as a support or resistance in two different points. For both of the points, the line should act either as support or as resistance. The yellow line in the above chart is an example.
Key lines are those lines which touches a reversal point three times. The blue line above is a key line.
Third type of line that I want to point out here is the slope-determining line. Those lines can be inner slope-determining lines (ISD lines) or outer slope-determining lines (OSD lines). Those lines determine the character of an entire polywave, that is, they indicate a major tendency of a collection of consecutive waves which themselves can have different sizes and directions. The slope of the green lines above, as an example, can be seen as the signature of the whole price action in 2015. Those green lines are ISD lines, meaning that the points where they touch reversals in the price action exist only within the price action of which the lines are signature. Other slope-determining lines may be entitled OSD lines. All those lines may also be called signature lines. Signature lines may or may not be a key line or a base line.
The market is a fight between those lines, and trying to figure out what happened in the fight may help us anticipate the future of the fight. In order to have a right perspective, I believe we should import the concept of "degree" to our theory. Here, for instance, the blue line exists in one larger degree than the other lines, and all the fight can be seen as evolving around it.