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'''Robert R. Prechter, Jr.''' (b. 1949) is an ] ] and stock market analyst, known widely for his financial forecasts using the ]. Prechter has authored or edited 14 books, including ''Conquer the Crash'', a ''New York Times'' bestseller.<ref>{{cite journal | title = Book Review | author = Best Sellers List | date = 11 August 2002 | journal = ] | pages = p. 24}}</ref> He has also published monthly financial commentary in '']'' since 1979, and is the founder of Elliott Wave International and New Classics Library.<ref>{{cite journal | first = Adam | last = Levy | title = The Ultimate Bear | date = February 2003 | pages = p. 69 | journal = Bloomberg Markets}}</ref><ref name=EWT>{{cite journal | title = Elliott Wave Theorist | author = Robert R. Prechter, Jr. | authorlink = Robert Prechter | date = various dates | journal = Elliott Wave International | location = ]
{{short description|American financial author and analyst}}
}}</ref> Prechter served on the board of the ] for nine years, and as the Association's President in 1990-1991. In recent years Prechter has supported the study of ], a theory about human social behavior. <ref>{{cite book | title = The Wave Principle of Human Social Behavior and the New Science of Socionomics | author = Robert R. Prechter, Jr. | authorlink = Robert Prechter | publisher = New Classics Library | location = ] | year = 1999}}</ref><ref>{{cite journal | first = David | last = Penn | title = Social Mood and the Markets | date = June 2003 | pages = p. 50 | journal = }}</ref>
{{Infobox person
__TOC__
| name = Robert Prechter
== Career ==
| image =
Prechter attended ] and graduated with a degree in psychology in 1971. His career as an analyst began when he joined ] as a market technician in 1975, where he learned much about the trade from Merrill's Chief Market Strategist, Robert Farrell (June 1982).<ref name=EWT/><ref name=SFO>{{cite journal | first = Kira | last = McCaffrey Brecht| title = Trader's Hall of Fame Award - Robert Prechter - An Interview with the Elliott Wave Guru | date = July 2003 | pages = p. 42 | journal = }}</ref> There Prechter also learned of the Wave Principle and was deeply intrigued:
| caption =
⚫ <blockquote>So I tracked down R.N. Elliott's original books. They weren't even in the Library of Congress. But I finally dug around in the New York Public Library and found a catalog card listing a copy of them on microfilm and had photocopies made. I was amazed to find that there was a wealth of information that had been lost to Wall Street.<ref name=Perspective>{{cite book | title = Prechter's Perspective | author = Robert R. Prechter, Jr. | authorlink = Robert Prechter | pages = p. 6 | publisher = New Classics Library | location = ] | year = 1996/2004}}</ref> </blockquote>
| birth_name =
⚫ Prechter has also said, "after I decided to make markets a career, I realized that mass psychology is what they're all about." <ref name=Perspective/>
| birth_date = {{Birth date|1949|03|25|mf=y}}
| birth_place =
| death_date =
| death_place =
| yearsactive =
| occupation = Financial author, and stock market analyst
| known_for =
| spouse =
| alma_mater = ]
}}
'''Robert R. Prechter Jr.''' (born March 25, 1949)<ref></ref> is an American financial author, and stock ], known for his financial forecasts using the ]. Prechter is an author and co-author of 14 books, and editor of 2 books,<ref>, Amazon.com.</ref> and his book ''Conquer the Crash'' was a '']'' bestseller in 2002.<ref>{{Cite news |last=Best Sellers List. |date=11 August 2002 |title=Book Review |page=24 |work=]}}</ref> He also has published monthly financial commentary in the newsletter '']'' since 1979, and is the founder of Elliott Wave International and New Classics Library.<ref name="Chen">{{Cite book |last=Chen |first=James. |title=Essentials of Technical Analysis for Financial Markets |publisher=John Wiley and Sons |year=2010 |isbn=978-0-470-53729-9 |location=New York |page=4}}</ref><ref name="EWT">{{Cite journal |last=Prechter |first=Robert R. Jr. |title=Elliott Wave Theorist |journal=Elliott Wave International. |location=]}}Essays include Peter Brandt, April 1991; Anne Crittenden, December 1997; Paul Macrae Montgomery, November 2000; Mark Galasiewski, July 2006.</ref> Prechter served on the board of the ] for nine years, and as its president in 1990–91. He has been a member of ] and ].<ref>{{Cite book|url=https://www.worldcat.org/oclc/52453595|title=The CRB commodity yearbook 2003|date=2003|publisher=Wiley|others=Commodity Research Bureau|isbn=0-471-44470-7|location=New York|pages=34T|oclc=52453595|quote=Prechter is a member of Mensa, Intertel, The Foundation for the Study of Cycles and the Shakespeare Oxford Society.}}</ref> In recent years Prechter has supported the study of socionomics, a theory about human social behavior.<ref name="Socionomics">. {{ISBN|0-932750-57-5}}. Two volumes: ''The Wave Principle of Human Social Behavior'' (1999); ''Pioneering Studies in Socionomics'' (2003).</ref><ref>{{Cite journal |last=Penn |first=David. |date=June 2003 |title=Social Mood and the Markets |url=http://www.traders.com/ |journal=Technical Analysis of Stocks & Commodities |page=50}}</ref>

In 2014 at the IFTA Conference in London Prechter was created a Fellow of the UK Society of Technical Analysts<ref>{{Cite web |title=STA Fellows |url=https://www.sta-uk.org/about-sta/fellows/ |access-date=2019-01-24 |website=Society of Technical Analysts |language=en-US}}</ref> in recognition of his lifetime contributions to Technical Analysis.

== Biography ==
Prechter attended ] and graduated with a ] degree in psychology in 1971. He became a drummer for his rock band throughout circa early 1970s.<ref>{{Cite magazine |last=Aitken |first=Lee |date=May 11, 1987 |title=Ace Analyst Robert Prechter Says When Skirts Rise, So Does the Stock Market—no Bull |url=http://people.com/archive/ace-analyst-robert-prechter-says-when-skirts-rise-so-does-the-stock-market-no-bull-vol-27-no-19/ |magazine=People |access-date=November 20, 2016}}</ref><ref>{{Cite book |last=Krass |first=Peter |url=https://archive.org/details/bookofinvestingw00pete |title=The Book of Investing Wisdom |publisher=John Wiley & Sons |year=1999 |isbn=978-0-471-29454-2 |chapter=Robert R. Prechter (1949–) |access-date=November 20, 2016 |chapter-url=https://books.google.com/books?id=b5GhHdVEoosC&q=%22Some+Guys+Have+All+The+Luck%22+-wikipedia&pg=PA262 |url-access=registration |via=Google Books}}</ref> His career as an analyst began when he joined ] as a market technician in 1975, where he learned much about the trade from Merrill's Chief Market Strategist, Robert Farrell (June 1982).<ref name=EWT/><ref name="SFO">{{Cite magazine |last=McCaffrey Brecht |first=Kira. |date=July 2003 |title=Trader's Hall of Fame Award - Robert Prechter - An Interview with the Elliott Wave Guru |url=http://sfomag.com/ |archive-url=https://web.archive.org/web/20011208112612/http://www.sfomag.com/ |url-status=usurped |archive-date=8 December 2001 |magazine=Stocks, Futures & Options Magazine |page=42}}</ref> There Prechter also learned of ] and the ] and was deeply intrigued:
⚫ <blockquote>So I tracked down R.N. Elliott's original books. They weren't even in the Library of Congress. But I finally dug around in the New York Public Library and found a catalog card listing a copy of them on microfilm and had photocopies made. I was amazed to find that there was a wealth of information that had been lost to Wall Street.<ref name="Perspective">{{Cite book |last=Prechter |first=Robert R. Jr. |title=Prechter's Perspective |publisher=New Classics Library |year=2004 |isbn=978-0-932750-61-7 |location=] |page=6 |orig-year=1996}}</ref> </blockquote>
⚫ Prechter has also said, "after I decided to make markets a career, I realized that mass psychology is what they're all about."<ref name=Perspective/>


== Prominence == == Prominence ==
In 1979 Prechter left Merrill Lynch and published the first subscription issue of the ''Elliott Wave Theorist''. The 1970s had been very bullish years in the gold market but mostly bearish for stocks, yet his Elliott wave analysis called for a long-term reversal lower in gold (February 1980)<ref name=EWT/><ref>{{cite journal | first = Karen| last = Lazarovic | title = Elliott-wave technician sees 2d-half blastoff | date = 30 April 1985 | pages = p. 36 | journal = New York Post}}</ref> and a long-term "super bull market underway" in stocks (October 1982).<ref name=EWT/><ref name = USA>{{cite journal | first = Russell| last = Shaw | coauthors = Landis, David | title = Prechter flees Wall St. for Georgia hills | date = 9 Oct. 1987 | pages = p. B1 | journal = }}</ref> Because these forecasts proved mostly correct -- especially for the stock indexes -- Prechter's following grew. In 1979 Prechter left Merrill Lynch and published the first subscription issue of the ''Elliott Wave Theorist''. The 1970s had been very bullish years in the gold market but mostly bearish for stocks, yet his Elliott wave analysis called for a long-term reversal lower in gold (February 1980)<ref name=EWT/><ref>{{Cite journal |last=Lazarovic |first=Karen. |date=30 April 1985 |title=Elliott-wave technician sees 2d-half blastoff |journal=New York Post |page=36}}</ref> and a long-term "super bull market underway" in stocks (October 1982).<ref name=EWT/><ref name="USA">{{Cite journal |last1=Shaw |first1=Russell |last2=Landis, David. |date=9 October 1987 |title=Prechter flees Wall St. for Georgia hills |url=https://www.usatoday.com/ |journal=USA Today |pages=B1}}</ref> Because these forecasts proved mostly correct&mdash;especially for the stock indexes&mdash;Prechter's following grew.
⚫ His visibility increased further after he won the U.S. Trading Championship in 1984, with a then-record 444% return in a monitored options trading account.<ref>{{cite journal | first = Allen R. | last = Myerson | title = Robert Prechter: From Lake Lanier, He Can See Wall Street Clearly | date = October, 1985 | pages = p. 26 | journal = }}</ref> He was profiled in many financial and business publications, and named "Guru of the Decade" by the ] (now ]).<ref>{{cite journal | first = Bill | last = Hendrick | title = Unbelievers Don't Worry Prechter | date = July 15, 1990 | pages = p. H-4 | journal = ]}}</ref>


⚫ His visibility increased further after he won the U.S. Trading Championship in 1984, with a then-record 444% return in a monitored options trading account.<ref>{{Cite journal |last=Myerson |first=Allen R. |date=October 1985 |title=Robert Prechter: From Lake Lanier, He Can See Wall Street Clearly |journal=Georgia Trend |page=26}}</ref> He was profiled in many financial and business publications and named "Guru of the Decade" by the ] (now ]) for the 1980s.<ref>{{Cite journal |last=Hendrick |first=Bill. |date=15 July 1990 |title=Unbelievers Don't Worry Prechter |journal=] |pages=H–4}}</ref>
In recent years he has been forecasting a large-scale bear market.

Prechter has been forecasting a large-scale bear market, as explained in his book ''Conquer the Crash''.<ref name="Conquer">{{Cite book|last=Prechter|first=Robert R. Jr.|title=Conquer the Crash: You Can Survive and Prosper in a Deflationary Depression|publisher=John Wiley and Sons|year=2009|isbn=978-0-470-56797-5|edition=2|location=New York}}</ref>


== Re-introduces Elliott == == Re-introduces Elliott ==
Much of Prechter's career as a publisher included his efforts to re-introduce R.N. Elliott's wave principle to investors.<ref name=SFO/> He compiled and republished all of Elliott's available writings, including the 1938 "Wave Principle," and the "Interpretive" and "Forecast" letters (1938-1946). Prechter also published a brief biography of Elliott, and the collected Elliott wave writings of the few technicians who practiced wave analysis in the 1950s and 1960s (Charles Collins, Hamilton Bolton, A.J. Frost, Richard Russell). Much of Prechter's career as a publisher includes his efforts to re-introduce R.N. Elliott's wave principle to investors.<ref name=SFO/> He compiled and republished all of Elliott's available writings, including the 1938 "Wave Principle," and the "Interpretive" and "Forecast" letters (1938–1946). Prechter also published a brief biography of Elliott and the collected Elliott wave writings of the few technicians who practiced wave analysis in the 1950s and 1960s (Charles Collins, Hamilton Bolton, A.J. Frost, Richard Russell).


Still, not all the popular exposure to Elliott wave analysis was the result of Prechter's deliberate efforts. In the few years before and after 1987, media coverage inflated Prechter's "guru" status to extremes, including the assertion that his forecasts could single-handedly "cause" the stock market to rise or fall <ref>{{cite journal | first = Phillip H.| last = Wiggins | title = Dow Drops a Record 91.55 Points | date = 7 October 1987 | pages = p. A1 | journal = New York Times}}</ref> (a proponent of ], Prechter considered this absurd). In the months after ] in October 1987, subscriptions to Prechter's ''Elliott Wave Theorist'' surged to some 20,000. That number declined in the early 1990s (as did the subscription levels of most other financial publishers), though "Prechter has done more to popularize and spread Elliott's philosophy than anyone else."<ref>{{cite journal | first = Millard| last = Grimes| title = Whatever happened to Robert Prechter? | date = August 1994 | pages = p. 24 | journal = Georgia Trend}}</ref> Still, not all the popular exposure to Elliott wave analysis was the result of Prechter's deliberate efforts. In the few years before and after 1987, media coverage inflated Prechter's "guru" status to extremes, including the assertion that his forecasts could single-handedly "cause" the stock market to rise or fall.<ref>{{Cite news |last=Wiggins |first=Phillip H. |date=7 October 1987 |title=Dow Drops a Record 91.55 Points |pages=A1 |work=New York Times}}</ref> In the months after ] in October 1987, subscriptions to Prechter's ''Elliott Wave Theorist'' surged to some 20,000. That number declined in the early 1990s (as did the subscription levels of most other financial publishers), though "Prechter has done more to popularize and spread Elliott's philosophy than anyone else."<ref>{{Cite journal |last=Grimes |first=Millard. |date=August 1994 |title=Whatever happened to Robert Prechter? |journal=Georgia Trend |page=24}}</ref>


== Criticism == ==Socionomics==
In 1979, Prechter postulated that social mood drives financial, macroeconomic and political behavior, in contrast to the conventional notion that such events drive social mood.<ref>Prechter, Robert R. Jr. (August 1979). "What's Going On?" ''The Elliott Wave Theorist''. Elliott Wave International. Gainesville, GA. Reprinted in ''Pioneering Studies'' (2003).</ref> His description of social mood as the driver of cultural trends reached a national audience in a 1985 cover article in '']''.<ref>Prechter, Robert R. Jr. (9 September 1985). "Elvis, Frankenstein and Andy Warhol". ''Barron's''.</ref> Prechter coined the term "socionomics" and in 1999 published an exposition of socionomic theory, ''The Wave Principle of Human Social Behavior''.<ref name=Socionomics/> In 2003, he published an anthology of empirical work in the field, ''Pioneering Studies in Socionomics''.
⚫ While Prechter has his admirers, he has been subjected to strong criticism. The ''Wall Street Journal'' ran a page one article in August 1993 with the headline, "Robert Prechter sees his 3600 on the Dow--But 6 years late," in reference to Prechter's 1987 forecast for the Dow Jones Industrial Average.<ref>{{cite journal | title = Robert Prechter sees his 3600 on the Dow--But 6 years late | author = William Power | date = 19 August 1993 | journal = ] | pages = }}</ref> Technical analyst David Aronson wrote:
⚫ <blockquote>The Elliott Wave Principle, as popularly practiced, is not a legitimate theory, but a story, and a compelling one that is eloquently told by Robert Prechter. The account is especially persuasive because EWP has the seemingly remarkable ability to fit any segment of market history down to its most minute fluctuations. I contend this is made possible by the method's loosely defined rules and the ability to postulate a large number of nested waves of varying magnitude. This gives the Elliott analyst the same freedom and flexibility that allowed pre-Copernican astronomers to explain all observed planet movements even though their underlying theory of an Earth-centered universe was wrong.<ref>David R. Aronson ''Evidence-Based Technical Analysis: Applying the Scientific Method and Statistical Inference to Trading Signals'' (Wiley, 2006), p. 41 </ref></blockquote>


Since then, the ] premise of the socionomic hypothesis&mdash;that social mood drives the character of social events&mdash;has gained attention in academic journals,<ref name="Dichotomy">Prechter, Robert R. Jr.; Parker, Wayne D. (2007). "The Financial/Economic Dichotomy in Social Behavioral Dynamics: The Socionomic Perspective". ''Journal of Behavioral Finance''. Vol. 8 No. 2, pp. 84-108. Retrieved Nov. 19, 2007.</ref><ref>Bollen, Johan; Mao, Huina; Zeng, Xiaojun. (March 2011). "Twitter mood predicts the stock market". ''Journal of Computational Science''. Vol. 2, No. 1, pp. 1-8. . Retrieved April 24, 2012.</ref><ref>Taylor, Richard. (3 September 2010). "Mood Swings". ''Science''. . Retrieved April 24, 2012.</ref> books,<ref>Casti, John L. (2010). . New York: Springer.</ref><ref>Malik, Constantin. (2010). ''Ahead of Change: How Crowd Psychology and Cybernetics Transform the Way We Govern''. Frankfurt: Campus Verlag. p.69. . Retrieved May 29, 2012.</ref> the popular press,<ref>Moyer, Justin. (3 February 2012). "If Romney wants to beat Obama, he should hope the Dow crashes". ''Washington Post''. . Retrieved May 29, 2012.</ref><ref>Krantz, Matt. (17 November 2009). “Could the Pop-Culture Mood Mirror Stock Market Swings?” ''USA Today''. . Retrieved May 14, 2012.</ref><ref>Editorial. (7 August 2009). "Could recession end cannabis ban?". ''New Scientist''. . Retrieved May 29, 2012.</ref> universities,<ref>Prechter, Robert R. Jr. (2004). "Socionomics - Social Mood as the Engine of Social Activity". Presented at the London School of Economics and Political Science, London, England, 18 March 2004. . Retrieved April 25, 2012.</ref> academic conferences<ref>Parker, Wayne D. (2006). "The Socionomic Theory of Finance and the Institution of Social Mood: Pareto and the Sociology of Instinct and Rationalization". Presented at the Conference of the Association for Heterodox Economics, London, United Kingdom, July 14–16, 2006. . Retrieved May 14, 2012.</ref><ref>Lampert, Matt. (2011). "The Central Bank in the Liberal Market Economy: Market Leader or Follower? Recent Comparative Evidence from the U.S. and Australia". Presented at the Academy of Behavioral Finance Conference, University of California-Los Angeles, Los Angeles, California, September 22, 2011. . Retrieved May 29, 2012.</ref> and in research funded by the ].<ref>. Retrieved Nov. 19, 2007.</ref><ref>. Retrieved April 25, 2012.</ref> The Socionomics Foundation hosts an annual conference each April in Atlanta GA regarding social mood.<ref>{{cite web |url=http://www.socialmoodconference.com/ |title=New Initiatives in Social Mood Research and Application |website=www.socialmoodconference.com |access-date=May 6, 2015 |archive-date=5 Jan 2013 |archive-url=https://web.archive.org/web/20130105035438/http://www.socialmoodconference.com/}}</ref> The conferences have included presentations from academics, authors and financial professionals such as ], ], Johan Bollen, Michelle Baddeley, ] and Robert Prechter.
] has criticized Prechter for the bearishness of his forecasts in the time since October 1987.<ref name=Malkiel>Malkiel, Burton (2003). '']'', New York, W.W. Norton, p. 163. ISBN 0393057828.</ref>


== Books == == Criticism ==
⚫ While Prechter has his admirers, he has been criticized by media and pundits for his long term record. For example, ''The Wall Street Journal'' ran a page one article in August 1993 with the headline, "Robert Prechter sees his 3600 on the Dow – But 6 years late," in reference to Prechter's 1987 forecast for the Dow Jones Industrial Average.<ref>{{Cite journal |last=Power, William. |date=19 August 1993 |title=Robert Prechter sees his 3600 on the Dow – But 6 years late |journal=]}}</ref> Technical analyst David Aronson wrote:
Among the books Prechter has authored, coauthored, or edited are:
⚫ <blockquote>The Elliott Wave Principle, as popularly practiced, is not a legitimate theory, but a story, and a compelling one that is eloquently told by Robert Prechter. The account is especially persuasive because EWP has the seemingly remarkable ability to fit any segment of market history down to its most minute fluctuations. I contend this is made possible by the method's loosely defined rules and the ability to postulate a large number of nested waves of varying magnitude. This gives the Elliott analyst the same freedom and flexibility that allowed pre-] astronomers to explain all observed planet movements even though their underlying theory of an Earth-centered universe was wrong.<ref name="Aronson">{{Cite book |last=Aronson |first=David R. |title=Evidence-Based Technical Analysis: Applying the Scientific Method and Statistical Inference to Trading Signals |publisher=John Wiley and Sons |year=2006 |isbn=978-0-470-00874-4 |location=New York |page=41}}</ref></blockquote>

* {{cite book | title = ''Elliott Wave Principle: Key to Market Behavior'' | publisher = ] | year = 1978-2001 | id = ISBN 0-471-98849-9}}
* {{cite book | title = ''R.N. Elliott's Market Letters'' | publisher = New Classics Library | year = 1993-1997 | id = ISBN 0-932750-20-6}}
* {{cite book | title = ''Complete Elliott Wave Writings of A. Hamilton Bolton'' | year = 1994 | publisher = New Classics Library | id = ISBN 0-932750-22-2}}
* {{cite book | title = ''The Elliott Wave Writings of A.J. Frost and Richard Russell'' | publisher = Bookworld Services | year = 1997 | id = ISBN 0-932750-47-8}}
* {{cite book | title = ''At the Crest of the Tidal Wave'' | publisher = ] | year = 1997 | id = ISBN 0-471-97954-6}}
* {{cite book | title = ''The Wave Principle of Human Social Behavior and the New Science of Socionomics'' | publisher = New Classics Library | year = 1999 | id = ISBN 0-932750-49-4}}
* {{cite book | title = ''Market Analysis for the New Millennium'' | publisher = New Classics Library | year = 2002 | id = ISBN 0-932750-52-4}}
⚫ * {{cite book | title = ''Conquer the Crash: You Can Survive and Prosper in a Deflationary Depression'' | publisher = John Wiley and Sons | year = 2002 | id = ISBN 0-470-87090-7}}
* {{cite book | title = ''Beautiful Pictures'' | publisher = New Classics Library | year = 2003 | id = ISBN 0-932750-60-5}}
* {{cite book | title = ''View from the Top of the Grand Supercycle'' | publisher = New Classics Library | year = 2003
| id = ISBN 0-932750-55-9}}
* {{cite book | title = ''Pioneering Studies in Socionomics'' | publisher = New Classics Library | year = 2003 | id = ISBN 0-932750-56-7}}
* {{cite book | title = ''Prechter's Perspective'' | publisher = New Classics Library | year = 1996 | id = ISBN 0932750400 }}
* {{cite book | title = ''R.N. Elliott's Master Works'' | publisher = New Classics Library | year = 2005 | id = ISBN 0-932750-76-1}}
* {{cite book | title = ''How to Forecast Gold and Silver Using the Wave Principle'' | publisher = New Classics Library | year = 2006 | id = ISBN 0-932750-77-X }}


== Notes == == Notes ==
{{reflist}} {{reflist|colwidth=30em}}


==References==
* ''Essentials of Technical Analysis for Financial Markets'' by James Chen. Published by John Wiley and Sons. {{ISBN|978-0-470-53729-9}}.
* ''Socionomics: The Science of History and Social Prediction'' by Robert Prechter. Published by New Classics Library. {{ISBN|0-932750-57-5}}.
* ''Prechter's Perspective'' by Robert Prechter. Published by New Classics Library. {{ISBN|978-0-932750-61-7}}.
* ''Evidence-Based Technical Analysis: Applying the Scientific Method and Statistical Inference to Trading Signals'' by David R. Aronson. Published by John Wiley and Sons. {{ISBN|978-0-470-00874-4}}
⚫ * ''Conquer the Crash: You Can Survive and Prosper in a Deflationary Depression (2 ed.)'' by Robert Prechter. Published by John Wiley and Sons. {{ISBN|978-0-470-56797-5}}.
* ''Behavioral Trading: Methods for Measuring Investor Confidence and Expectations'' by Woody Dorsey. Published by Texere. {{ISBN|1-58799-164-0}}.


==External links==
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Latest revision as of 19:06, 22 September 2024

American financial author and analyst
Robert Prechter
Born(1949-03-25)March 25, 1949
Alma materYale University
Occupation(s)Financial author, and stock market analyst

Robert R. Prechter Jr. (born March 25, 1949) is an American financial author, and stock market analyst, known for his financial forecasts using the Elliott Wave Principle. Prechter is an author and co-author of 14 books, and editor of 2 books, and his book Conquer the Crash was a New York Times bestseller in 2002. He also has published monthly financial commentary in the newsletter The Elliott Wave Theorist since 1979, and is the founder of Elliott Wave International and New Classics Library. Prechter served on the board of the CMT Association for nine years, and as its president in 1990–91. He has been a member of Mensa and Intertel. In recent years Prechter has supported the study of socionomics, a theory about human social behavior.

In 2014 at the IFTA Conference in London Prechter was created a Fellow of the UK Society of Technical Analysts in recognition of his lifetime contributions to Technical Analysis.

Biography

Prechter attended Yale University and graduated with a B.A. degree in psychology in 1971. He became a drummer for his rock band throughout circa early 1970s. His career as an analyst began when he joined Merrill Lynch as a market technician in 1975, where he learned much about the trade from Merrill's Chief Market Strategist, Robert Farrell (June 1982). There Prechter also learned of Ralph Nelson Elliott and the Elliott wave principle and was deeply intrigued:

So I tracked down R.N. Elliott's original books. They weren't even in the Library of Congress. But I finally dug around in the New York Public Library and found a catalog card listing a copy of them on microfilm and had photocopies made. I was amazed to find that there was a wealth of information that had been lost to Wall Street.

Prechter has also said, "after I decided to make markets a career, I realized that mass psychology is what they're all about."

Prominence

In 1979 Prechter left Merrill Lynch and published the first subscription issue of the Elliott Wave Theorist. The 1970s had been very bullish years in the gold market but mostly bearish for stocks, yet his Elliott wave analysis called for a long-term reversal lower in gold (February 1980) and a long-term "super bull market underway" in stocks (October 1982). Because these forecasts proved mostly correct—especially for the stock indexes—Prechter's following grew.

His visibility increased further after he won the U.S. Trading Championship in 1984, with a then-record 444% return in a monitored options trading account. He was profiled in many financial and business publications and named "Guru of the Decade" by the Financial News Network (now CNBC) for the 1980s.

Prechter has been forecasting a large-scale bear market, as explained in his book Conquer the Crash.

Re-introduces Elliott

Much of Prechter's career as a publisher includes his efforts to re-introduce R.N. Elliott's wave principle to investors. He compiled and republished all of Elliott's available writings, including the 1938 "Wave Principle," and the "Interpretive" and "Forecast" letters (1938–1946). Prechter also published a brief biography of Elliott and the collected Elliott wave writings of the few technicians who practiced wave analysis in the 1950s and 1960s (Charles Collins, Hamilton Bolton, A.J. Frost, Richard Russell).

Still, not all the popular exposure to Elliott wave analysis was the result of Prechter's deliberate efforts. In the few years before and after 1987, media coverage inflated Prechter's "guru" status to extremes, including the assertion that his forecasts could single-handedly "cause" the stock market to rise or fall. In the months after Black Monday in October 1987, subscriptions to Prechter's Elliott Wave Theorist surged to some 20,000. That number declined in the early 1990s (as did the subscription levels of most other financial publishers), though "Prechter has done more to popularize and spread Elliott's philosophy than anyone else."

Socionomics

In 1979, Prechter postulated that social mood drives financial, macroeconomic and political behavior, in contrast to the conventional notion that such events drive social mood. His description of social mood as the driver of cultural trends reached a national audience in a 1985 cover article in Barron's. Prechter coined the term "socionomics" and in 1999 published an exposition of socionomic theory, The Wave Principle of Human Social Behavior. In 2003, he published an anthology of empirical work in the field, Pioneering Studies in Socionomics.

Since then, the counter-intuitive premise of the socionomic hypothesis—that social mood drives the character of social events—has gained attention in academic journals, books, the popular press, universities, academic conferences and in research funded by the National Science Foundation. The Socionomics Foundation hosts an annual conference each April in Atlanta GA regarding social mood. The conferences have included presentations from academics, authors and financial professionals such as Richard L. Peterson, Tobias Preis, Johan Bollen, Michelle Baddeley, Todd Harrison and Robert Prechter.

Criticism

While Prechter has his admirers, he has been criticized by media and pundits for his long term record. For example, The Wall Street Journal ran a page one article in August 1993 with the headline, "Robert Prechter sees his 3600 on the Dow – But 6 years late," in reference to Prechter's 1987 forecast for the Dow Jones Industrial Average. Technical analyst David Aronson wrote:

The Elliott Wave Principle, as popularly practiced, is not a legitimate theory, but a story, and a compelling one that is eloquently told by Robert Prechter. The account is especially persuasive because EWP has the seemingly remarkable ability to fit any segment of market history down to its most minute fluctuations. I contend this is made possible by the method's loosely defined rules and the ability to postulate a large number of nested waves of varying magnitude. This gives the Elliott analyst the same freedom and flexibility that allowed pre-Copernican astronomers to explain all observed planet movements even though their underlying theory of an Earth-centered universe was wrong.

Notes

  1. Prechter, Robert R(ougelot) Jr.
  2. Robert R. Prechter Jr., Bibliography, Amazon.com.
  3. Best Sellers List. (11 August 2002). "Book Review". New York Times. p. 24.
  4. Chen, James. (2010). Essentials of Technical Analysis for Financial Markets. New York: John Wiley and Sons. p. 4. ISBN 978-0-470-53729-9.
  5. ^ Prechter, Robert R. Jr. "Elliott Wave Theorist". Elliott Wave International. Gainesville, Georgia.Essays include Peter Brandt, April 1991; Anne Crittenden, December 1997; Paul Macrae Montgomery, November 2000; Mark Galasiewski, July 2006.
  6. The CRB commodity yearbook 2003. Commodity Research Bureau. New York: Wiley. 2003. pp. 34T. ISBN 0-471-44470-7. OCLC 52453595. Prechter is a member of Mensa, Intertel, The Foundation for the Study of Cycles and the Shakespeare Oxford Society.{{cite book}}: CS1 maint: others (link)
  7. ^ Prechter, Robert R. Jr., (2003). Socionomics: The Science of History and Social Prediction, Gainesville, GA: New Classics Library. ISBN 0-932750-57-5. Two volumes: The Wave Principle of Human Social Behavior (1999); Pioneering Studies in Socionomics (2003).
  8. Penn, David. (June 2003). "Social Mood and the Markets". Technical Analysis of Stocks & Commodities: 50.
  9. "STA Fellows". Society of Technical Analysts. Retrieved 24 January 2019.
  10. Aitken, Lee (11 May 1987). "Ace Analyst Robert Prechter Says When Skirts Rise, So Does the Stock Market—no Bull". People. Retrieved 20 November 2016.
  11. Krass, Peter (1999). "Robert R. Prechter (1949–)". The Book of Investing Wisdom. John Wiley & Sons. ISBN 978-0-471-29454-2. Retrieved 20 November 2016 – via Google Books.
  12. ^ McCaffrey Brecht, Kira. (July 2003). "Trader's Hall of Fame Award - Robert Prechter - An Interview with the Elliott Wave Guru". Stocks, Futures & Options Magazine. p. 42. Archived from the original on 8 December 2001.{{cite magazine}}: CS1 maint: unfit URL (link)
  13. ^ Prechter, Robert R. Jr. (2004) . Prechter's Perspective. Gainesville, Georgia: New Classics Library. p. 6. ISBN 978-0-932750-61-7.
  14. Lazarovic, Karen. (30 April 1985). "Elliott-wave technician sees 2d-half blastoff". New York Post: 36.
  15. Shaw, Russell; Landis, David. (9 October 1987). "Prechter flees Wall St. for Georgia hills". USA Today: B1.
  16. Myerson, Allen R. (October 1985). "Robert Prechter: From Lake Lanier, He Can See Wall Street Clearly". Georgia Trend: 26.
  17. Hendrick, Bill. (15 July 1990). "Unbelievers Don't Worry Prechter". Atlanta Journal-Constitution: H–4.
  18. Prechter, Robert R. Jr. (2009). Conquer the Crash: You Can Survive and Prosper in a Deflationary Depression (2 ed.). New York: John Wiley and Sons. ISBN 978-0-470-56797-5.
  19. Wiggins, Phillip H. (7 October 1987). "Dow Drops a Record 91.55 Points". New York Times. pp. A1.
  20. Grimes, Millard. (August 1994). "Whatever happened to Robert Prechter?". Georgia Trend: 24.
  21. Prechter, Robert R. Jr. (August 1979). "What's Going On?" The Elliott Wave Theorist. Elliott Wave International. Gainesville, GA. Reprinted in Pioneering Studies (2003).
  22. Prechter, Robert R. Jr. (9 September 1985). "Elvis, Frankenstein and Andy Warhol". Barron's.
  23. Prechter, Robert R. Jr.; Parker, Wayne D. (2007). "The Financial/Economic Dichotomy in Social Behavioral Dynamics: The Socionomic Perspective". Journal of Behavioral Finance. Vol. 8 No. 2, pp. 84-108. Abstract here. Retrieved Nov. 19, 2007.
  24. Bollen, Johan; Mao, Huina; Zeng, Xiaojun. (March 2011). "Twitter mood predicts the stock market". Journal of Computational Science. Vol. 2, No. 1, pp. 1-8. Abstract here. Retrieved April 24, 2012.
  25. Taylor, Richard. (3 September 2010). "Mood Swings". Science. Preview here. Retrieved April 24, 2012.
  26. Casti, John L. (2010). Mood Matters: From Rising Skirt Lengths to the Collapse of World Powers. New York: Springer.
  27. Malik, Constantin. (2010). Ahead of Change: How Crowd Psychology and Cybernetics Transform the Way We Govern. Frankfurt: Campus Verlag. p.69. Abstract here. Retrieved May 29, 2012.
  28. Moyer, Justin. (3 February 2012). "If Romney wants to beat Obama, he should hope the Dow crashes". Washington Post. Article here. Retrieved May 29, 2012.
  29. Krantz, Matt. (17 November 2009). “Could the Pop-Culture Mood Mirror Stock Market Swings?” USA Today. Article here. Retrieved May 14, 2012.
  30. Editorial. (7 August 2009). "Could recession end cannabis ban?". New Scientist. Preview here. Retrieved May 29, 2012.
  31. Prechter, Robert R. Jr. (2004). "Socionomics - Social Mood as the Engine of Social Activity". Presented at the London School of Economics and Political Science, London, England, 18 March 2004. Document here. Retrieved April 25, 2012.
  32. Parker, Wayne D. (2006). "The Socionomic Theory of Finance and the Institution of Social Mood: Pareto and the Sociology of Instinct and Rationalization". Presented at the Conference of the Association for Heterodox Economics, London, United Kingdom, July 14–16, 2006. Program here. Retrieved May 14, 2012.
  33. Lampert, Matt. (2011). "The Central Bank in the Liberal Market Economy: Market Leader or Follower? Recent Comparative Evidence from the U.S. and Australia". Presented at the Academy of Behavioral Finance Conference, University of California-Los Angeles, Los Angeles, California, September 22, 2011. Document here. Retrieved May 29, 2012.
  34. Announcement of this research in 2006 by the American National Election Studies. Retrieved Nov. 19, 2007.
  35. Announcement of this research in 2011 by the National Academies of Science. Retrieved April 25, 2012.
  36. "New Initiatives in Social Mood Research and Application". www.socialmoodconference.com. Archived from the original on 5 January 2013. Retrieved 6 May 2015.
  37. Power, William. (19 August 1993). "Robert Prechter sees his 3600 on the Dow – But 6 years late". The Wall Street Journal.
  38. Aronson, David R. (2006). Evidence-Based Technical Analysis: Applying the Scientific Method and Statistical Inference to Trading Signals. New York: John Wiley and Sons. p. 41. ISBN 978-0-470-00874-4.

References

  • Essentials of Technical Analysis for Financial Markets by James Chen. Published by John Wiley and Sons. ISBN 978-0-470-53729-9.
  • Socionomics: The Science of History and Social Prediction by Robert Prechter. Published by New Classics Library. ISBN 0-932750-57-5.
  • Prechter's Perspective by Robert Prechter. Published by New Classics Library. ISBN 978-0-932750-61-7.
  • Evidence-Based Technical Analysis: Applying the Scientific Method and Statistical Inference to Trading Signals by David R. Aronson. Published by John Wiley and Sons. ISBN 978-0-470-00874-4
  • Conquer the Crash: You Can Survive and Prosper in a Deflationary Depression (2 ed.) by Robert Prechter. Published by John Wiley and Sons. ISBN 978-0-470-56797-5.
  • Behavioral Trading: Methods for Measuring Investor Confidence and Expectations by Woody Dorsey. Published by Texere. ISBN 1-58799-164-0.

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