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CONCEPT & HISTORY

Who invented Elliott Wave Theory?

DIRECT ANSWER

Elliott Wave Theory was invented by Ralph Nelson Elliott (1871-1948), an American accountant who developed the wave principle while recovering from illness in the 1930s. He published it in 'The Wave Principle' (1938) and 'Nature's Law' (1946).

Full Explanation

Ralph Nelson Elliott spent his career as an accountant working on railroad and corporate restructurings before becoming bedridden with anemia in the late 1920s. During his recovery he studied 75 years of stock market data — yearly, monthly, weekly, daily, and hourly charts of the Dow Jones — and identified what he called 'the wave principle.' His insight was that markets move in repeating five-wave and three-wave structures rooted in mass investor psychology. Elliott published his first book, The Wave Principle, in 1938, followed by Nature's Law: The Secret of the Universe in 1946. His work was largely forgotten after his death in 1948 until Robert Prechter and A.J. Frost revived it in their 1978 book Elliott Wave Principle, which became the modern standard reference.

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