Fibonacci & Time Frame Trader's Time Frame
Wave analysis will usually forecast price targets either exactly or within points of a target. Where it can be more challenging is with time estimates. Elliotticians generally believe that time is secondary to wave form. But there are clues in the wave pattern and Fibonacci sequence that will help narrow the time frame for a significant trend change with reasonable accuracy.
One way is the actual waves themselves. If you are tracking, say, the conclusion of a wave 5, knowing that it should be equivalent to wave 1, or related in length by a Fibonacci ratio, you can apply the same forecast to time as well as price. For example, let's say wave 1 took 10 days to form. You might project wave 5 to take 10 days to also form. If wave 5 exceeds wave 1 in its formation, look for potential tops in roughly 13, 16, to 18 days. If on the other hand wave 5 appears to be losing steam on declining volume and may end up being shorter than wave 1, look for a possible reversal between 5-8 days from the start of its formation. I use days in this example, but the same can be true of months or years.
Occasionally, numbers in the Fibonacci sequence that coincide with dates for previous key market reversals can help in forecasting future ones. I used this method in helping to track turns in what then appeared to me the early phases of a bull market in oil and natural gas in March 2000 (right as techs were starting their nosedive). I discuss this, along with the application of the Wave Principle, in some examples from my personal trading.
First, I looked for past Fibonacci relationships between previous dates of significance (anywhere from 34, 55, 89, 144 or 233 days) and looked for any repetitive patterns based on these numbers. I also looked for where two or more of these dates converged over a similar time frame. This method assisted me in clarifying my wave count, and told me when to go long and when to go short the XNG and XOI indices, which I did successfully over the next several months. The method isn't full proof by any means, though it seems the greater the number of relatable dates, the better its chance for timing potential changes.
I also incorporated this method in trading option contracts on the OEX (the S&P 100 index). I noted in my analysis a convergence of Fibonacci dates in the OEX around November 25, 2000 right in the middle of a two day rally following the Thanksgiving holiday. The foreknowledge allowed me to go short the index with option put contracts, as I expected a market decline to occur into early December. The OEX did indeed peak on November 27 (the first available trading day after the holiday) and declined until November 30, yielding me a nice profit on my options.