Ron Rosen - Elliott Wave

Ron Rosen - Elliott Wave - DJIA & S&P500

Ron Rosen - Elliott Wave - DJIA & S&P500
Elliott Wave - The Rule Of Alternation

There is a general tendency for the pattern of the two corrective swings in a completed 5-wave sequence to alternate
between a simple (very often an ABC) correction and one of the more complicated or �complex� Elliott corrections.

In most cases Wave (2) usually unfolds as a simple ABC correction.
Or put another way, a simple ABC correction is found in a Wave (2) correction more often than in a Wave (4).

Elliott Waves - Wave (2) simple abc pattern

Again, this is a very useful piece of information, because once Wave (1) is complete,
then the most likely pattern to unfold is a simple ABC correction.

And, because of the rule of alternation, this leads onto Wave (4)
usually being the complex correction in a completed 5-wave sequence.

Apparently the Rule of Alteration also applies to the megaphone patterns on the S&P500 and the DJIA.
The 1966 to 1974 megaphone pattern for the S&P500 had a rising upper trend line.
The 1966 to 1974 megaphone pattern for the DJIA had a horizontal upper trend line.
Starting in the year 2000 these megaphone patterns alternated their location.
The S&P has a horizontal upper trend line and the DJIA has a rising upper trend line.