By Kira McCaffrey Brecht, Bridge News

Chicago--July 6, 1999--As an undergraduate at Yale University, Robert Prechter started keeping a chart of the gold market and watching it from a rudimentary Elliott Wave basis. The Elliott bug bit him as his wave forecasts hit their targets in the early years of the massive bull market that ultimately drove gold above $800 in early 1980. He has come under fire in recent years because of his unwavering calls for a stock market top, but still expects to see a major retracement, even calling for the Dow to slide below 1,000 at some point.

Bob Prechter

Prechter, who played a big role in putting Elliott Wave analysis on the map in the 1980s, has taken the Elliott Wave principles and formed them into a fascinating mix of social and financial theories. Currently president of Elliott Wave International in Gainesville, Ga., he has built his career on the Wave Principle, expanding the theory to include human social behavior as it manifests itself in the economy and financial markets.

Elliott wave analysis, developed by Ralph Elliott, is based on repetitive wave patterns, which in turn reflect the Fibonacci number sequence. Very simplistically, an ideal Elliott pattern is a 5-wave advance followed by a 3-wave decline.