Testing RET's search capability

The new search capability now built in RET may be a powerful weapon in our arsenal to locate candidates for trading. Before, we had to come up with candidates to evaluate using RET. This is powerful, to be sure, but by this approach, we would have to hope that we run across a chart with the right pattern that could then be verified by RET to be an incomplete zigzag. That is, a stock currently in a wave B, ready to swing into wave C, which is likely to be a strong wave.

This is more or less the same approach that Advanced Get uses to locate candidates about to swing. However, in that software they call them wave 4 set ups (type I trade) ready to swing into wave 5. Advanced Get also claims that this is a powerful, high probability set up.

In both cases, I believe, Elliott wave theory is underestimated, for the sake of quick trades. To really use the Elliott wave to its full power, the proposed candidates would have to be analysed from the begining of its trading history, since its IPO. This is the orthodox method that is really Elliott theory. Everything else may claim to be Elliot, but it is really not. Thus, they need to be tested for true reliability in the real world. You and I know that there are many "systems" being sold to us on a daily basis. The results in the real world are not always what we hope. Thus, the use of the PCCRC may be a way to hedge our bets, as long as the right IV profile is in place.

I am currently testing the zigzag theory put forth by Rich Swannelle, with his recent software modifications. I don't have the hourly capability, so my trades will have to wait a few weeks to see how reliable the approach really is. But the disadvantage until now has been that, unlike advanced Get, RET did not offer the ability to locate candidates from the vast number of stocks in the US markets. This was a major drawback, because we had to find the candidates to test.

In my DVD 1 (distributed to you upon request to my e-mail: paperprofit1@gmail.com), I describe a technique using Telechart and IQcharts to locate candidate daily. However, there are days in which I locate dozens of candidates both in the bearish and in the bullish side. Both software have "slide show" capabilities, that is, I can see an image of each candidate quickly at the interval of several seconds. I can pause the "slide show" if I identify a candidate pattern that is consistent with waves A-B of a zigzag, or a waves 1-2 of an impulse. This approach, at the very least, sharpen my skills as an elliottician and quickly goes through the candidates for the day. However, this is not much help to the beginner who have enough doubts about his/her skills.

So, yes, I have been looking forward to Swannelle's new search capability, but I am not ready to endorse it yet, let alone suggest that you go aquiring the software to put it to good use. For one thing, there is no documentation yet, on how to use it. Swannelle has said that the operation is intuitive, so I have tried to use the search capability. Here is what I have found out:

1. You can specify a watch list from the computer to be search for the zigzag pattern.
2. The search is hardly instantaneous. So you are going to have to be patient. I think that this rules out a daily search of the entire market for the pattern of interest.
3. You can reduce the search time by entering the watch list. I have tried my bearish and bullish candidate watch list created as described in my DVD 1 (again, you can request the disk by e-mail).

If you have followed the instructions in DVD 1, you already have the watch lists needed by RET to search for valid zigzag patterns. Here is what you do, once in RET and assuming you have already run the scans in Telechart:


1. Select Open from the File menu.
2. In the "Open" window that pops up, locate a field named "Server:" near the bottom right. This is a pop up menu that should include "TC2000 WatchList" as an item. Select it. If you cannot see this item, then you need to create the list from within Telechart described in my DVD 1.
3. If item 2 above is done properly, the open window changes to include a field on the left bottom corner labelled "TC200 Watch List Options:". This field should contain the "1. Bearish Elliott Candidates" and the "1. Bullish Elliott Candidates" described in my DVD 1. Select each one of these lists in turn by simply clicking on each in turn. If you do this properly, the "Open" window title at the top of the window changes to say either "Open TC2000 WatchList - 1. Bearish Elliott Candidates" or "Open TC2000 WatchList - 2. Bearish Elliott Candidates". In either case, you will search for the zigzag pattern in each stock in the list. This saves the work of visual pattern recognition (at least in theory).
4. All candidates in the corresponding list will appear in the top field in the open window. Select all candidates in the top field. I typed control-A and all candidate stocks were selected.
5. The "Load Options:" should be set to Load all. Although I pressume that Swannell will have to explain that is the appropriate number of days. For now, I leave it up to you to tinker with that setting or wait for further documentation on this item.
6. click on the "Scanner" bottom. The Scanner Window should include the following items in the corresponding fields:

Scan For Elliott Wave Patten: Zigzag
Incomplete Wave #: 3
Largest Degree Pattern Filter: Any Pattern
PowerPack: USA Stocks 2007 (Growth)
Long/Short Trades: Short (in the case of the Bearish Elliott Candidate List), Long (in the case of the Bullish Elliott Candidate List).
Min Rating (80 in both fields).
√ exclude if Market has Entered Target Area.

click the Start Scan Bottom.
Each item in the list will be examined. It will take the same time it will take you to inspect eavery candidate on the list, but at least you can go get a cup of coffee while the process is complete. But I think you can exclude the idea of scanning the whole market every day.

The validity, accuracy and reliability of this approach remains to be seen. As I said, I am not ready to endorse this approach, but we will work together (I hope) to sort through the realistic and the unrealistic, the useful and the useless.