The Output Gap

The output gap represents the difference between the two measures of GDP – real and potential – in percentage term. This measure turned negative in Q1 of 2008 and it stayed below zero till the Q2 2017. The Real potential GDP is the CBO’s estimate of the output the economy would produce with a high rate…

Elliott Wave Principles – Basic Tenets

Ralph Nelson Elliott noticed in 1930s that the up-and-down movements in the stock market prices have identifiable patterns. Based upon this observations he deduced a wave structure that he named The Wave Principle and published a book in 1938 detailing it. Now it is known as Elliott Wave Principle. After Elliott’s death in 1948, many people…

Real and Nominal Rates Of Interest

Interest rates have real implications in the investment world. So does the forecast about them, hence, it pays to understand the concept of interest rates. There are three fundamental factors that impact the interest rates: Supply – this is the funds available with the savers, primarily households Demand – the demand for funds by the…

Dollar Index Explained

The U.S. Dollar index is a geometrically average of six currencies weighted against the U.S. dollar. It was created by the Federal Reserve in 1973 and the ICE USDX index is the trading vehicle for it. The index contains six currencies: the euro, Japanese yen, British pound, Canadian dollar, Swedish krona and Swiss franc. The euro…

Bollinger Band Basics

Senior Analyst Jeffrey Kennedy shows you how these volatility indicators support pattern recognition As a technical trader, are you able to view financial market fluctuations clearly and reliably? At Elliott Wave International, we hold that the Elliott Wave Principle is the most effective tool for analysis. Yet the Wave Principle works well with other technical…