ââ ððŠðĄððĻ
â A zigzag always subdivides into three waves.
â Wave âķ always subdivides into an impulse or leading diagonal.
â Wave âļ always subdivides into an impulse or ending diagonal.
â Wave â· always subdivides into a zigzag, flat, triangle or combination thereof.
â Wave â· never moves beyond the start of wave âķ.
â Wave â· always ends within the price territory of wave âķ.
â Wave âļ almost always ends beyond the end of wave âķ. (failure to comply with this requirement is called ÂŦtruncationÂŧ)*
*guideline, but should be followed as a rule
â ððŠððððĄððĢððĻ
â Wave âļ should not fail to reach the end of wave âķ by more than 10% of the length of wave âķ. (Q&A EWI)
â In a zigzag, the length of wave âļ is usually equal to that of wave âķ, although it is not uncommonly 1.618 or .618 times the length of wave âķ (rarely 2.618).
â Wave â· typically retraces 38 to 79 percent of wave âķ.
â If wave â· is a contracting triangle, it will typically retrace 38 to 50 percent of wave âķ.
â If wave â· is a running contracting triangle, it will typically retrace between 10 and 40 percent of wave âķ.
â If wave â· is a zigzag, it will typically retrace 50 to 79 percent of wave âķ.
â In a zigzag, if wave âķ is a leading diagonal, then we would not expect to see an ending diagonal for wave âļ.
â A line connecting the ends of waves âķ and âļ is often parallel to a line connecting the end of wave â· and the start of wave âķ. (Forecasting guideline: Wave âļ often ends upon reaching a line drawn from the end of wave âķ that is parallel to a line connecting the start of wave âķ and the end of wave â·.)
â Waves âķ and âļ within the zigzag often appear in the form of impulses, but more often alternate according to the type of motive waves: if wave âķ is an impulse, expect wave âļ in the form of a diagonal, and vice versa. It is much less common to find waves âķ and âļ in the form of diagonals, but in this case they will alternate in form: contracting / expanding, and vice versa. (TWEWA)
â If a similar amplitude and duration of waves âķ and âļ within a single zigzag is expected, the line passing through the top of âķ, which is parallel to the line connecting the beginning of wave âķ and the end of wave â·, often turns out to be the level of completion of wave âļ. In case of a extended wave âķ within a single zigzag, expect the wave âļ to reach the middle line of the channel, and in case of signals in favor of a extended wave âļ, it is worth resorting to the technique of doubling the channel to determine potential support or resistance. (TWEWA)
__________________________
ðReferences:
Elliott Wave Principal 2005
Trade Waves / Elliott Waves Analysis (TWEWA)
ð Elliott Wave Guide & Ellott Wave Archive âŽïļâŽïļ
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