Wave Counts

I liked the trend spotting thread; Good, short, simple, and thought provoking.


My immediate idea was to apply to waves rather than just bars. However, I didn’t quite like the idea that the numbers jumped from say 4 to 19 depending on how many more prices the new high or low broke. I wanted a simple method of potentially letting me know when a trend would stop or at least halt, and while this method isn’t it, it was close enough to give me the right idea (for this initial phase).

Similar to the Barros LCC (line change count), but again, I wanted to use the wave as a whole.

wave count

Top is for up waves, bottom is for down waves.

The results seem to suggest that flats are a constant in “breaks” during a trend. One thing I like is that extremes show more clearly. I know very well when price should stop to make a lower high or a higher low, rather than seeing constant bars of 99+ as I would if I implemented the indicator provided in the thread.


After the 3 count, a “break” from lower lows is needed, even if for just a bit.

Signal to reverse seems like it will be much harder to crack.


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