Once of the most popular, and least understood theories of technical analysis in Forex is the Elliott Wave Principle. Developed by Ralph Nelson in the 1920s as a method of trend forecasting for stocks markets, the Elliot Wave theory applies fractal mathematics to market fluctuations in order to create forecasts on how market sentiment will behave. In Essence, the Elliott Wave theory states the the market always moves in series of five upward waves, and three downward waves, which repeat themselves. However, if everything was as simple as that, virtually anyone would be able to easily benefit from this scheme, riding trends as they appear. Obviously, things are somewhat more complicated.