An Impulse Wave is a five-wave move (labelled 1-2-3-4-5) in the direction of the larger trend. Waves 1, 3 and 5 advance while 2 and 4 correct; wave 3 is usually the strongest and never the shortest.
How traders use it
- Wave 3 is often the longest and most powerful.
- Wave 4 should not overlap wave 1's territory.
- Impulse waves set the direction; corrections react against them.
See it in dtcharts
Label waves and Fibonacci levels on live charts in the dtcharts terminal with the Elliott Wave and Fibonacci tools.