After over 40 years of investing in the markets one learns that the markets are constantly changing, not only in price, but in what drives the markets. In the 1960s, the Nifty Fifty were the leaders of the stock market. In the 1970s, stock selection using Technical Analysis was important, as the market stayed with a trading range for the entire decade. In the 1980s, the market finally broke out of it doldrums, as the DOW broke through 1100 in 1982, and launched the greatest bull market on record.

It was during the early 1980s that I was introduced to the Elliott Wave Theory, through two books written and edited by Robert Prechter, and AJ Frost; the "Elliott Wave Principle", and " RN Elliott's Original Works". After months upon months of analyzing the stock market, applying the information provided in the texts, I began to notice some problems:

- there wasn't any definitive answer to where one wave ended and another began,
- there weren't any confirming indicators outside of the wave structure itself.
- RN Elliott, the founder, had problems identifying the wave structure between 1932 - 1942.

Nevertheless, the EWT certainly looked promising, and was an amazing discovery. As an engineer by trade, I decided to put the Theory to the test of time: the entire history of the US stock market. Living near Washington, DC at the time. I ventured down to the Library of Congress, and collected all the historical data I could find. Eventually, I discovered a book, published by Dow Jones-Irwin; "The Dow Jones Averages 1885 - 1980". Still have it too! Over the next several months I analyzed the markets using the historical data, and the EWT. In time, I made some startling discoveries. The missing tenets of the EWT. The tenets that turned RN Elliotts work, from a Theory into a Principle.



Trader Type: Trader/Investor                  Preferred Approach: Technical/Elliott Wave