Smart Elliott Wave

The Smart Elliott Wave indicator is an automated analysis tool that detects and validates Elliott Wave patterns using dynamic Fibonacci rules and geometric logic. It aims to simplify complex wave counting by identifying impulsive and corrective structures while filtering out noise through objective validation criteria.

Usage

The tool automatically scans for both bullish and bearish price structures, labeling Impulse Waves (0-1-2-3-4-5), Simple Corrections (ABC), and Complex Corrections (WXY). You can use it to identify current market trends and anticipate potential turning points.

Key visual elements include:

• Impulse Lines: Visualizes the 5-wave sequence of a trend.
• Correction Zones: Colored areas that highlight price retracements.
• Potential Reversal Zones (PRZ): Projected Fibonacci extension boxes that act as dynamic take-profit or stop-loss areas.
• Alerts: Real-time notifications for newly confirmed wave structures, triggered after the bar closes to ensure stability.

Details

The indicator identifies structures using pivot points determined by user-defined lookback periods. For an Impulse Wave to be valid, it must follow strict classical rules: Wave 3 cannot be the shortest, and Wave 4 cannot overlap the price territory of Wave 1. If "Fibonacci Rules" are enabled, the script further validates these waves against standard ratios (e.g., 38.2%, 61.8%) to ensure the patterns are mathematically sound. Complex WXY structures are only plotted when standard ABC corrections are insufficient to describe the price action.

Settings

Wave Settings

• Pivot Left/Right Strength: Controls the number of bars required to confirm a high or low pivot. Higher values result in more significant but delayed wave detection.
• Enable Fibonacci Rules: Toggles whether patterns must meet specific Fibonacci ratio requirements to be displayed.
• Fibonacci Tolerance %: Adjusts how much a price level can deviate from an exact Fibonacci ratio while still being considered valid.

Display & PRZ Settings

• Show Previous Patterns: Choose to display all historical patterns or only the most recent one.
• PRZ Extension Bars: Determines how many bars into the future the Potential Reversal Zone boxes will extend.
• Fibonacci Levels (38.2% - 161.8%): Individual toggles and color pickers for the specific levels displayed in the PRZ boxes.

FAQ

How do I interpret the blue and red colors? Blue lines and fills represent bullish wave structures, while red lines and fills indicate bearish structures.

Why did a pattern disappear or move? If "Pivot Right Strength" is set to 0, the indicator works in real-time and may repaint as new price data confirms or invalidates a pivot. For stable patterns, use a higher Pivot Right value.

How do I access the Smart Elliott Wave? You can get access on the LuxAlgo Library for charting platforms like TradingView, MetaTrader (MT4/MT5), and NinjaTrader for free.