What Every Trader Really Needs to be Successful: A Method

By Elliott Wave International

In 1984, Elliott Wave International Founder Robert Prechter won the United States Trading Championship with a then-record 444% return. After Bob won, many subscribers asked for a list of tips, or even a breakdown of his trades, to try and replicate his success. Bob knew that wouldn’t help, so instead, he created a short list of “rules” that every trader needs to be successful. Here’s one:

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A Method

I mean an objectively definable method. One that is thought out in its entirety to the extent that if someone asks you how you make your decisions, you can explain it to him, and if he asks you again in six months, he will receive the same answer. This is not to say that a method cannot be altered or improved; it must, however, be developed as a totality before it is implemented. A prerequisite for obtaining a method is acceptance of the fact that perfection is not achievable. People who demand it are wasting their time searching for the Holy Grail, and they will never get beyond this first step of obtaining a method. I chose to use, for my decision making, an approach which was explained in our book, Elliott Wave Principle. I think the Wave Principle is the best way to understand the framework of a market and where prices are within that framework. There are a hundred other methods which will work if successful trading is your only goal. As I have often said, a simple 10-day moving average of the daily advance-decline net, probably the first indicator a stock market technician learns, can be used as a trading tool, if objectively defined rules are created for its use. The bad news is that as difficult and time consuming as this first major requirement can be, it is the easiest one to fulfill.

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See 4 more “rules for success” in EWI's free Special Report, What Every Trader Really Needs to be Successful.

This article was syndicated by Elliott Wave International and was originally published under the headline What Every Trader Really Needs to be Successful: A Method. EWI is the world's largest market forecasting firm. Its staff of full-time analysts led by Chartered Market Technician Robert Prechter provides 24-hour-a-day market analysis to institutional and private investors around the world.

Spotting the Nasdaq 100 Top Before a 12% Decline

By Elliott Wave International

On June 3, the Nasdaq 100 was at a record high.

But Robert Kelley, editor of Elliott Wave International’s U.S. Intraday Stocks Pro Service, saw reason to be cautious. The index was tracing out an expanding ending diagonal — an uncommon Elliott wave pattern that can signal an advance is nearing exhaustion.

Here’s what Kelley told subscribers that day:

“All right, so there’s the Nasdaq. It did make a slight new high, making this a reasonably conforming ending diagonal. We didn’t quite get to the five is longer than three count, but in my book, that’s not really a big deal, not really required. I don’t think Elliott himself ever dictated that requirement.

“But so far, the drop isn’t looking too impulsive… but the count shows it could be done.”

He then gave subscribers two levels to watch:

“That’s a big support level there, 30,318, roughly. So if that can give way, it’s in good shape to go lower. And this last rebound high, I think probably should contain any recovery, 30,694.75.”

What Happened Next:

The Nasdaq 100 turned lower. By the end of July, it had fallen roughly 12% from its June high.

The important point isn’t simply that the market fell. At the high, while the prevailing trend was still up, the wave pattern gave Kelley reason to watch for a reversal — along with specific price levels that would help confirm or challenge that outlook.

That’s what EWI’s Pro Services are built to provide: ongoing Elliott wave analysis, key levels and potential turning points across the markets you follow.

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For a limited time, you can try EWI's Pro Services for one week for just $77. The Test Drive gives you unrestricted access to the entire Pro Services lineup — the same intraday, daily and weekly updates subscribers get, on all key markets worldwide — for pennies on the dollar!

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This article was syndicated by Elliott Wave International and was originally published under the headline Pro Services Spotted the Nasdaq 100 Top Before a 12% Decline. EWI is the world's largest market forecasting firm. Its staff of full-time analysts led by Chartered Market Technician Robert Prechter provides 24-hour-a-day market analysis to institutional and private investors around the world.

MSTR (Strategy) following it's Elliott wave script?

By Elliott Wave International

On October 15, 2025, Elliott Wave International's crypto analysts showed this chart to subscribers and outlined a developing setup in Strategy (MSTR).

"Favoring that wave 2 ended at 365.21, we're looking for a swift decline in five waves to complete wave 3."

What happened next?

Strategy declined sharply. At the time of the forecast, MSTR was trading near $300.67. As the wave structure unfolded, price declined to $104.17 by early February — a move of roughly 65%. MSTR would go on to fall as low as $81.81. The chart below shows the massive move into the February low.

Now what?

EWI's Crypto Junctures analyst Jason Soni recently recorded a subscriber video that highlights a NEW developing setup in MSTR. EWI have made the video FREE for a limited time.

See the new setup in MSTR now >>

Don't miss it — the sooner you see the setup, the sooner you can act.

Elliott Wave Counting Exercise: Start Simple and Adjust Along the Way

By Elliott Wave International

A good Elliott wave count isn't necessarily the one you come up with first.

As price develops, the structure can provide new information — and your interpretation needs to account for it.

That's what makes this new lesson interesting.

Elliott Wave Counting Exercise: Start Simple and Adjust Along the Way takes you inside the process of building and refining a wave count. You'll see market veteran Favio Poci start with the big picture, work down into shorter-term structures, and use wave rules, channeling and Fibonacci relationships to assess what's developing.

If you're interested in the practical side of Elliott wave analysis, you can watch the full lesson for free at elliottwave.com – free.

Junk Bond Spreads Diverge Further From Stocks

By Elliott Wave International

One of the stock market’s important warning signs is getting louder. Junk bond spreads and equities usually move together. When they don’t, it’s worth paying attention. Check out this excerpt from Elliott Wave International's August 19 Short Term Update.

“[This chart] shows updated prices for both the S&P 500 and the Bloomberg CCC-rated junk bond yield spread, which is inverted … so that it aligns with stock prices. So, a declining line on the chart showing junk bond spreads means that spreads are widening, indicating increasing investor angst. Most of the time, junk bond spreads trend and reverse with equities. When the trends between the two sectors diverge, it is meaningful. …

“At the left side of the chart, junk bond spreads made a low in late June 2021 and started to widen thereafter, signaling coming trouble for stocks. Five months later the Nasdaq 100 index topped in November 2021 and started a 38% decline to October 2022. Seven months after junk spreads started to widen, the S&P topped in early January 2022 and subsequently declined 28% to October 2022.

“After the April 7, 2025 market low, junk bond spreads narrowed until late January of this year. … An aggressive widening trend has been underway since then, with spreads now at the same level as they were two years ago, in August 2024. ...”

This is just one of many signals EWI's analysts are tracking.

See 18 more flashing red signals inside their newly updated must-read report.

This article was syndicated by Elliott Wave International and was originally published under the headline Junk Bond Spreads Diverge Further From Stocks. EWI is the world's largest market forecasting firm. Its staff of full-time analysts led by Chartered Market Technician Robert Prechter provides 24-hour-a-day market analysis to institutional and private investors around the world.