Constructing Elliott wave ABC and triangle pattern counts

Construct the motive wave

A motive wave is constructed as five swings, with waves 1, 3, and 5 in the larger trend and waves 2 and 4 against it. In an advance those trend swings print higher highs. In a decline they print lower lows.

Elliott wave labeling is hierarchical. Nested motive and corrective swings are named so a chart condition becomes a testable count.

Apply ratio and extension constraints

Wave 3 cannot be the shortest of the three trend waves. It may equal wave 1 and is often described as 161.8% of wave 1. If those two are equal, wave 5 is usually the shorter one, with wave 5 often described as 61.8% to 100% of wave 1.

Any of the three trend waves can extend, most often wave 3. An extended wave is much longer and slower to form, commonly reveals nested lesser-degree waves, and usually breaks the channel that would contain a non-extended motive.

Construction guidelines for the other waves follow that choice. If wave 1 is extended, waves 2 through 5 are often 61.8% of wave 1. If wave 3 is extended, wave 5 often equals wave 1. If wave 5 is extended, it is often 161.8% of the span from wave 1 through wave 3.

Account for a truncated fifth and for diagonals

A truncated fifth fails to return to the channel destination expected for a completed fifth, so the following correction can begin earlier, and at a different price, than a full-channel projection.

An ending diagonal is a 3-3-3-3-3 wedge typically placed in wave 5 or C and allows wave 4 to overlap wave 1. A leading diagonal is a 5-3-5-3-5 wedge typically placed in wave 1 or A and should not be read as a corrective triangle.

Construct the correction from templates

Corrective construction starts from three templates. A zigzag is 5-3-5 with B shorter than A and C beyond A. A flat is 3-3-5 with three roughly equal legs. An expanded flat is 3-3-5 with B beyond the origin of A and C often 161.8% of A.

An ABC correction is this three-leg template. It covers zigzags and flats and can be chained into larger combinations. The alternation guideline says that if wave 2 is a simple correction, wave 4 is often a complex one, which is why a pattern roster is used while labeling developing corrections.

Identify triangles and combinations

A triangle pattern is a five-leg 3-3-3-3-3 corrective contraction or expansion that precedes continuation in the larger trend. In an expanding form wave 1 is shortest and wave 5 longest. In a contracting form the reverse is true. The expected exit follows the succeeding trend wave rather than the slope of the triangle or a support-resistance reading of the flat side.

A combination correction can sequence a zigzag, a connecting wave, and a triangle into one larger correction that is often identifiable only after it has completed.