How to trade Commodities - Gold, Silver, Crude Oil, Natural Gas
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BULLISH AND BEARISH WOLFE WAVES
BASIC RULES FOR IDENTIFYING AN WOLFE WAVE
* Waves 3-4 must stay within the channel created by waves 1-2.
* Waves 1-2 equal waves 3-4 (showing symmetry).
* Wave 4 revisits the channel of points established by waves 1-2.
* There should be regular timing intervals between waves.
* Waves 3 and 5 are usually 127% or 162% (Fibonacci) extensions of the previous channel point.
The pattern can be found in:
* Rising channels in an uptrend.
* Falling channels in a downtrend.
* Level channels during consolidation periods.
Notice that the point at wave 5 shown on the diagrams above is a move slightly above or below the channel created by waves 1-2 and 3-4. This move is usually a false price breakout or channel breakdown, and is the best place to enter a stock long or short. The "false" action at wave 5 occurs most of the time in the pattern, but isn't an absolutely necessary criterion.
The point at wave 6 is the target level following from point 5 and is the most profitable part of the Wolfe Wave channel pattern. The target price (point 6) is found by connecting points 1 and 4 (see the red lines in Figures 1 and 2).
BASIC RULES FOR IDENTIFYING AN WOLFE WAVE
* Waves 3-4 must stay within the channel created by waves 1-2.
* Waves 1-2 equal waves 3-4 (showing symmetry).
* Wave 4 revisits the channel of points established by waves 1-2.
* There should be regular timing intervals between waves.
* Waves 3 and 5 are usually 127% or 162% (Fibonacci) extensions of the previous channel point.
The pattern can be found in:
* Rising channels in an uptrend.
* Falling channels in a downtrend.
* Level channels during consolidation periods.
Notice that the point at wave 5 shown on the diagrams above is a move slightly above or below the channel created by waves 1-2 and 3-4. This move is usually a false price breakout or channel breakdown, and is the best place to enter a stock long or short. The "false" action at wave 5 occurs most of the time in the pattern, but isn't an absolutely necessary criterion.
The point at wave 6 is the target level following from point 5 and is the most profitable part of the Wolfe Wave channel pattern. The target price (point 6) is found by connecting points 1 and 4 (see the red lines in Figures 1 and 2).
THANKS A LOT BUDDY...................................:clapping:
Sorry, Kamlesh. I was just going through various threads last night, and came upon yours. I don't trade in commodities, nor do I follow them. Just saw your chart and your comment on it. Couldn't resist to butt in (and now I am paying for the trespassing! 
I am aware that most of us have standard 'wedge' patterns in mind. No wonder you guys didn't see the one I was talking about. What is wedge anyway? Well, by rough definition, any two continuing lines in a plane, moving in the same direction, will create one if their angles are converging. As simple as that.
I am afraid I don't have access to crude oil chart, so I drew the one I saw (in green) in yours.
In 'trading' wedges, candles keep getting squeezed from either or both sides. That is, no room for high amplitude waves. Decision point. If you are familiar with median lines (check two parallel, and one bisecting, white lines), Demark's seq (or power of 9), then shooting through the trendline was on the cards anyway after getting the supply side almost dried in previous two sharp down moves. Hence, the rising of the bottom within the boundry of drawn wedge.
For confirmation, you can check the Stochs or RSI for positive divergence buildup. Also you may find huge volume spikes under the drawn wedge. Normally this kind of drama happens when the big players decide to shoot through the SLs or book profits on the high. And I guess the price must have sharply plunged later as the bearish Wolfe pattern would have formed, leaving both small-time bulls and bears high and dry! Typical...
PS. Alright then. Paid for my last night's 'transgression'. Carry on with your good, selfless work. Best of luck.
I am aware that most of us have standard 'wedge' patterns in mind. No wonder you guys didn't see the one I was talking about. What is wedge anyway? Well, by rough definition, any two continuing lines in a plane, moving in the same direction, will create one if their angles are converging. As simple as that.
I am afraid I don't have access to crude oil chart, so I drew the one I saw (in green) in yours.
In 'trading' wedges, candles keep getting squeezed from either or both sides. That is, no room for high amplitude waves. Decision point. If you are familiar with median lines (check two parallel, and one bisecting, white lines), Demark's seq (or power of 9), then shooting through the trendline was on the cards anyway after getting the supply side almost dried in previous two sharp down moves. Hence, the rising of the bottom within the boundry of drawn wedge.
For confirmation, you can check the Stochs or RSI for positive divergence buildup. Also you may find huge volume spikes under the drawn wedge. Normally this kind of drama happens when the big players decide to shoot through the SLs or book profits on the high. And I guess the price must have sharply plunged later as the bearish Wolfe pattern would have formed, leaving both small-time bulls and bears high and dry! Typical...
PS. Alright then. Paid for my last night's 'transgression'. Carry on with your good, selfless work. Best of luck.
Please check upper green line is Downwards and lower green line is Upwards.
Also, i believe definition should not be 'rough' otherwise it would not be defining anything, which is what it should do.
In this instance also rough approximation lead to incorrect pattern recognition.
Following is the link to access crude oil chart for your convenience.
http://quotes.esignal.com/esignalpr...chart.bardensity=LOW&x=24&y=19&chart.studies=
Please see if "And I guess the price must have sharply plunged later as the bearish Wolfe pattern would have formed, leaving both small-time bulls and bears high and dry! Typical." came true. as i cannot see any bearish WW set up.
Anyways...Best Wishes!.
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THANK U VERY MUCH for ur valuable inputs..............really a great piece of knowledge sharing.................practicing to find WW on all TFs and IN ALL COMMODITIES.....................hope to learn very soon........with such great inputs....................CHEERS!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!:thumb:......BLESSED TO BE PART OF A GREAT THREAT AND SUCH A WONDERFUL FORUM.......TJ LIVE LONG................................:clapping:
Theorem 12: TREND is the BIGGEST pattern. Trend lines the BIGGEST indicator.
Theorem 13: Trend REVERSAL takes multifold force as compared to Trend CONTINUATION.
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Theorem 13: Trend REVERSAL takes multifold force as compared to Trend CONTINUATION.
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