Elliott wave principle is a technical study which is used to analyse financial market cycles. The use of Elliott wave is not restricted to forex trading and it can be applied to equity trading as well. The theory is based on 5 wave counts, with 1 ,3 and 5 being motive waves while waves 2 and 4 being corrective waves. The idea is to catch waves 1,3 and 5 but it is difficult to identify wave 1. When applying this theory on trading, please also consider using other technical studies to complement your trading. For those who are new to Elliott wave principle, you may hear mixed comments about it. Some would say that Elliot wave counts are quite subjective, yes, I do agree. Hence, you need to identify wave structures and complement with Fibonacci expansion or other technical tools.
Most importantly, you need to identify waves 3 and 5, and use it to capture trend movement.