Happy 4th of July!! Got to love the holiday weekends!!

The following excerpt was taken from Jeff Greenblatt’s best-selling book, *Breakthrough Strategies for Predicting Any Market: Charting Elliott Wave, Fibonacci, Lucas and Time for Profit*. The section that follows is a brief introduction to his timing methodology. A prominent speaker, a regular contributor to Futures magazine, and the editor of the Fibonacci Forecaster, Greenblatt is making a large impact in the international technical analysis community.

### From Chapter 2, A New Look at the Language of Elliott Waves

This chapter is designed to show you how to work with wave counts based on the time dimension. We know that Elliott is very subjective. The best part of working with these time relationships is that they are easier to recognize than counting the waves. Wave counts are difficult pattern-recognition systems because they evolve over a period of time.

When we track the time element, we follow repeatable tendencies that are simple to recognize when we know what to look for. In this chapter, I will teach you how to confirm a wave count using the time bars.... Let’s look at our first example. Figure 2.1 illustrates a 5-wave impulse pattern in Motorola. The first thing to note is the look. Elliott and others stressed repeatedly that a pattern has to have the correct look. We do have a textbook 5-wave sequence, where 3 is not the smallest wave, and 4 doesn’t overlap the price territory of wave 1.

Those are your basics. Now, let’s look at all of the relationships inside of this pattern. In Figure 2.1, the first thing to note is how the first wave tops in 38 hours: a crucial time bar because 38.2 is a Fibonacci retracement level as the square root of .618. When we are dealing with time cycles, any Fibonacci or Lucas relationship is fair game for a turn in whatever degree of trend we happen to be observing. We followed up the 38-hour wave with an 11- hour correction. Not only is 11 a Lucas number, but when we divide 11 by 38, we get 28.9 percent. In terms of time, this means that we had a Lucas 29-percent time retracement. From that low, the third wave came close to a common 1.618 extension of the first wave. It’s not perfect, but the time relationship sheds more light on why the third wave ended where it did. Going back to the first wave, we know we topped on hour 38 and bottomed for the second wave on hour 48. The third wave topped on hour 147, which is a 99-hour wave. When we divide the time relationship between the first and third waves (99/38), we get a calculation of 2.605 or just a hair off a common 2.618 Fibonacci relationship.

In this case, we have a time/price cluster of nearly a perfect 1.618 price relationship along with a 2.618 time relationship. The fourth wave completed on the 161st hour of the move. What usually happens in small-degree, corrective waves is that they will either end on an important number like 161, or the correction itself will end on the correct number of bars or a cluster of the two. In this case, the move ends on the 14th hourly bar, which is a derivative of a 14.6 percent retracement level. In terms of time, the number 14 occurs less often in significant turns. The fifth wave lasts 45 hours and ends on the 206th hourly bar. There are no perfect common relationships in this case, but if we were to scale up to the daily time period, we would see the whole move completed in 29 daily Lucas bars.

The lesson from this example is that in real time we don’t get perfect common Fibonacci relationships in our waves. We need a way to x-ray the waves to understand what is going on underneath the surface. While we do have the proper look of a 5-wave sequence, we could get lost looking for common textbook Fibonacci relationships. When we examine the time relationships, we find the sequence is loaded with good time relationships. They serve as our compass to understand the waves no matter what the wave count is telling us. The next chart in Figure 2.2 is a perfect textbook example of a triangle that completed in the correct amount of bars. This is likely the best example of Guide 2 (Most corrective patterns such as triangles or complex flats will terminate or confirm on a specific time bar) and your introduction to the profound influence that Lucas exerts on the market everyday.

This situation occurred on the 15-minute NASDAQ E-mini (NQ) on December 11–12, 2005. This sequence coincided with one of the Federal Reserve’s interest rate announcements. The NQ has a tendency to change patterns based on a 47-15 minute cycle. On Monday, December 11, we hit a near term high at 1719, but as we were entrenched in a bull move at the time, what happened was a sideways consolidation that manifested as a triangle. Common relationships in triangles dictate that at least two of the legs should have a .618/1.618 relationship to each other.

In this case, A and C come very close. However, what is important to note in this triangle is that it confirms in the 47 bar window. In this case, the 46–47 bar window coincided exactly with a Fed news event. This pattern consolidated sideways for much of two trading sessions. Upon completion of the triangle, this market jumped 16 points in the next two bars. Internally, we can see the A wave lasted 8 bars, B wave topped on 13, C wave lasted 7 bars, and D wave lasted 16 bars (double 8 or 1.618 derivative). Not all triangles are gift-wrapped so neatly, but many have relationships just like this one and are easily spotted if you know what to look for.

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