This particular methodology is perhaps the most unique, effective trading technique I’ve (Linda) ever come across! It was developed and shared by a good friend, Bill Wolfe, who for the last 10 years has made a living trading the S&P
His son, Brian, also trades it. Brian was the first teenager I’ve ever met who consistently made a good income scalping NYFE (Knife) futures from his apartment. Brian, now 21, has expanded into trading the Wolfe Wave in other markets.
Bill’s theory of wave structure is based on Newton’s first law of physics: for every action there is an opposite reaction.
This movement creates a definite wave with valuable projecting capabilities. This wave most clearly sets up when there is good volatility. With a bit of practice, it is easy to train your eye to spot these patterns instantly.
The following rules will make sense when you examine the examples. (Please note the odd sequence in counting. As you will see, it is necessary- for the inductive analysis.)