Are Wolfe Waves Easy to learn?
Yes! Just as with any other indicator or trading system, with enough practice and chart time, you should be able to trade off Wolfe waves just as easily as a moving average crossover strategy.
Books I recommend
Price action trading with the wave concept is one of the most basic and intriguing methods to trade forex. Some of the books that I have read and I find to be of great value are the following.
Is there any discretion used when plotting Wolfe Waves?
Yes! There is a little bit of discretion involved. However, for most part when a definitive Wolfe Wave pattern is formed you won't miss it. The only problem that arises is when there are smaller wolfe waves formed within the larger. Which again, isn't that hard once you have the practice.
What timeframe is best for plotting Wolfe Waves
Any timeframe works as long as your are comfortable with it. Personally, I do not look any lower than 1-hour timeframes. This is purely a matter of personal choice and trading goals. But Wolfe Waves do form across all timeframes. Which ones you choose to trade is up to you!
You often make use of Stochs, Median Lines and other additional indicators. Is it necessary?
The additional indicators I use is purely to reaffirm my bias on a particular trade. Which is why some if not most of my trades also have an additional indicator (usually an oscillator) to determine price reversals.
Are Wolfe Waves fail safe?
No! Just as with any other trading system, Wolfe Waves are not accurate. The reason is because the indicators and trading methods are plotted upon the recent price data. Thus, at best the indicators and trading methods (Wolfe Waves included) only point us to possible scenarios. Eventually it is the price which determines the outcome.
Why are some Wolfe Waves contradictory to general market sentiment?
Some times you will come across Wolfe Waves that tell you the exact opposite to that of the general market sentiment. When you come across such a situation, pay more attention. Either your analysis is wrong or your Wolfe Wave pattern has captured something beforehand. There are only two outcomes. Either you have a losing trade or you have one big winner on your hand. Patience is key!
Does price always arrive at the estimated date and projected price?
No! This rarely happens. There are various factors involved. From volume to price action and the fundamentals in play to many other variables that are hard to comprehend. However, price does come to the eventual projected price sooner or later. Thus, use your target levels based off key pivot or Fib levels.
Do Wolfe Waves work for any market?
Yes, as long as there is a fair amount of liquidity. In particular, Wolfe Wave works for Forex, Metals, Stocks. You can also use it in other less liquid markets, but it can get tricky. Wolfe waves can be used for analysis in less liquid markets to gain an idea. Be careful when using Wolfe Waves in the futures markets as the futures contract expiry date plays an important role.
Yes! Just as with any other indicator or trading system, with enough practice and chart time, you should be able to trade off Wolfe waves just as easily as a moving average crossover strategy.
Books I recommend
Price action trading with the wave concept is one of the most basic and intriguing methods to trade forex. Some of the books that I have read and I find to be of great value are the following.
- The Best Trendline Methods of Alan Andrews and Five New Trendline Techniques
- Integrated Pitchfork Analysis: Basic to Intermediate Level (Wiley Trading)
- Cloud Charts: Trading Success with the Ichimoku Technique
Is there any discretion used when plotting Wolfe Waves?
Yes! There is a little bit of discretion involved. However, for most part when a definitive Wolfe Wave pattern is formed you won't miss it. The only problem that arises is when there are smaller wolfe waves formed within the larger. Which again, isn't that hard once you have the practice.
What timeframe is best for plotting Wolfe Waves
Any timeframe works as long as your are comfortable with it. Personally, I do not look any lower than 1-hour timeframes. This is purely a matter of personal choice and trading goals. But Wolfe Waves do form across all timeframes. Which ones you choose to trade is up to you!
You often make use of Stochs, Median Lines and other additional indicators. Is it necessary?
The additional indicators I use is purely to reaffirm my bias on a particular trade. Which is why some if not most of my trades also have an additional indicator (usually an oscillator) to determine price reversals.
Are Wolfe Waves fail safe?
No! Just as with any other trading system, Wolfe Waves are not accurate. The reason is because the indicators and trading methods are plotted upon the recent price data. Thus, at best the indicators and trading methods (Wolfe Waves included) only point us to possible scenarios. Eventually it is the price which determines the outcome.
Why are some Wolfe Waves contradictory to general market sentiment?
Some times you will come across Wolfe Waves that tell you the exact opposite to that of the general market sentiment. When you come across such a situation, pay more attention. Either your analysis is wrong or your Wolfe Wave pattern has captured something beforehand. There are only two outcomes. Either you have a losing trade or you have one big winner on your hand. Patience is key!
Does price always arrive at the estimated date and projected price?
No! This rarely happens. There are various factors involved. From volume to price action and the fundamentals in play to many other variables that are hard to comprehend. However, price does come to the eventual projected price sooner or later. Thus, use your target levels based off key pivot or Fib levels.
Do Wolfe Waves work for any market?
Yes, as long as there is a fair amount of liquidity. In particular, Wolfe Wave works for Forex, Metals, Stocks. You can also use it in other less liquid markets, but it can get tricky. Wolfe waves can be used for analysis in less liquid markets to gain an idea. Be careful when using Wolfe Waves in the futures markets as the futures contract expiry date plays an important role.
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