ANSWER:

In 1990, when I released Mastering Elliott Wave (MEW), that was also my assumption. The statements in MEW were derived from 7 years of personal experience trading, forecasting markets and teaching Wave analysis. At the time of MEW’s release, I had only witnessed one bull market and the start of one bear market; so, my market experience was limited. During the 25 years following its release, I’ve discovered neutral Triangles, 3rd-extension Terminals, Diametrics and Symmetrical patterns. All those new Wave phenomenon are explained in the Education section of the new NEoWave website – https://www.neowave.com/product-book.asp). 

What I’ve come to realize, over 32 years, is that legs of a Triangle (if enough complexity is present) tend to mimic the behavior of the Triangle itself. So, if a Triangle is contracting, its last leg frequently contracts. If a neutral Triangle is forming, the c-wave or the e-wave has a strong tendency to produce a neutral Triangle. If an expanding Triangle is forming, wave-e has a propensity to form an expanding Triangle. 

As an important end note, if your chart contains so much complexity that you can see a smaller Triangle form as wave-a of the larger Triangle, then your chart is TOO complex and must be simplified to avoid the subjectivity that comes with high structural complexity.

ANSWER:

At risk of comparing market action to the “Theory of Relativity,” the answer to your question is dependent on the technical expertise of the observer. There is the “visual appearance” of a market top and then the “structural, technical reality” of a market top. 

Visually speaking, from the lay-person’s perspective, a market can “look” as if it tops slowly or quickly, that it is followed by a violent reversal right off the highs or it slowly “falls off” the highs in a bowl-shaped fashion. 

Technically speaking, from a NEoWave perspective, patterns don’t always conclude at the high or low of a trend – they can finish “below highs” and “above lows.” When a market ends a psychological Wave pattern below a high, it may slowly top and not produce a violent decline right off the highs. But, if you begin your assessment of the “new trend” from the actual conclusion of the old trend, then YES “all major tops complete with a violent reversal.”

ANSWER:

What you stated was correct for the first 60 years of Elliott Wave history and was the reason I developed NEoWave. To be truly useful and accurate, Elliott Wave needed substantial upgrading and refining. Most of all, it lacked a comprehensive, rigid, logical foundation. If wave theory is to have ANY validity, its rules must give the practitioner the ability to produce a single wave count and forecast that can be replicated by others. 

In my book Mastering Elliott Wave (in hind sight I should have called it Mastering NEoWave), I address this long-standing problem of Elliott Wave. My book adds so many additional rules and concepts to the wave analysis process that it elevates it out of the realm of supposition and into the realm of science. The three most important concepts of NEoWave, which help to accomplish this goal, are:

1- Logic (a strong correction must produce a future, strong move),

2- Self-defining (a smaller pattern cannot take more price and time than a larger pattern),

3- Self-confirming (strict requirements for post-pattern market behavior determine whether your prior structural analysis was correct – in other words, you do not decided if your analysis is correct, NEoWave RULES help you grade your assessments).

Without these rigid, logical NEoWave rules, analytical chaos ensues creating an environment where every wave analyst has a different count and opinion. With the addition of the above rules to orthodox Elliott Wave, you get NEoWave (that is, a “new” wave theory), which makes it possible to produce wave counts that stand the test of time. For example, in the back of my book Mastering Elliott Wave, there is a wave count projecting the future course of the U.S. stock market for 75 years (that forecast has been accurate for 23 years and still has 52 years to go)!