Debunking the Reigning Theory of Stock Market Pricing

By Elliott Wave International

The reigning theory of stock market pricing says investors rationally revalue stocks as new information enters the marketplace.

If that were true, stock charts would look like this:

The stock market would trend mostly sideways, fluctuating within narrow ranges as minor bits of news mostly canceled each other out. Sharp jumps or drops to new planes of stability would occur when major news broke and investors adjusted prices to a new level.

But real market charts don’t look like that.

In reality, stock prices run wildly up and down every second, minute, hour, day, week, month, year and decade.

Almost no one questions the exogenous-cause theory of pricing.

Elliott Wave International did.

EWI tested 13 widely accepted claims that link economic, political and monetary variables to market movements.

Learn what they discovered when you read the first two chapters of Robert Prechter’s The Socionomic Theory of Finance – free..

This article was syndicated by Elliott Wave International and was originally published under the headline Debunking the Reigning Theory of Stock Market Pricing. 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.

EWAVES Has Logged 2,329 S&P Points Since February

By Elliott Wave International

How powerful is EWAVES? Let the numbers speak for themselves. Imagine acting on just two EWAVES calls this year:

February 24, 2025: EWAVES identified the termination of a 2-year long uptrend before the S&P 500 closed that day at 5983. A short there, covered at the 4982 close on April 8th when EWAVES recognized that the decline was over, would have delivered 1,001 S&P points.

April 8, 2025: EWAVES turned bullish, with waves labeled to indicate a move to new all-time highs. Buying at the close around 4982 and staying with EWAVES’ bullish opinion into the July 22nd close at 6309 (a conservative bullish target) delivered another 1,328 S&P points.

That’s a total of 2,329 S&P points, following just two calls from EWAVES. With just a single S&P E-Mini contract, those points would be worth $116,450.

This isn’t hindsight. These were real-time forecasts, made before the turns, with precise wave labeling and elliotticity confidence scores.

February 24, 2025 – Bearish Setup

April 8, 2025 – Bullish Setup

July 22, 2025 – Conservative Bullish Target Met

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This article was syndicated by Elliott Wave International and was originally published under the headline EWAVES Has Logged 2,329 S&P Points Since February. 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.