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2010issue C068-9

An unfinished fifth wave blocked a second-wave count

A reader reopened a published S&P 500 wave count after price moved above the first-wave area and argued that a second-wave decline had not begun. A later review still placed the S&P 500 in the fourth wave of that first-wave advance, with the fifth wave unfinished, so the second-wave label stayed a sequel rather than a live count.

  • An impulse wave is incomplete while a fifth wave is still expected.
  • Wave counting applies a larger second-wave label only after the first-wave sequence finishes.
  • A count check after price moves through a prior first-wave high does not start a second-wave decline by itself.
  • Nested fourth- and fifth-wave labels can sit inside a larger first-wave advance.
Entries in this reading3 entries
Current trackImpulse wave12 readingsWave counting23 readingsElliott wave analysis94 readings

A count check after the first-wave area

A reader contested a published count by arguing that once the S&P 500 had moved above the first-wave area, a second-wave decline had not begun.

That challenge is a count check. The published labels are reopened when price appears to have moved through a prior first-wave high.

What the original count allowed

The original count described the S&P 500 as still advancing in a first wave and treated relative-strength confirmation as support for that label.

That count still treated a later second-wave decline as the normal sequel to a first-wave advance, but not as a decline already underway.

Nested waves still inside the first-wave advance

A later review placed the S&P 500 in the fourth wave of that first-wave advance. The same review left a fifth wave of the first-wave advance still unfinished.

Those smaller fourth- and fifth-wave labels were counted inside the larger first-wave advance. An impulse wave is a five-leg advance that is not complete while a fifth wave is still expected.

When the count can shift to a second-wave decline

The reply treated completion of that fifth wave as the condition for shifting the count to a second-wave decline.

Wave counting numbers nested legs so a larger second-wave label is used only after the first-wave sequence finishes.

Educational research material, not investment advice. Historical source context does not establish present-day performance.
4 of 12 in the Impulse wave track
201040-42 pp.Next on Impulse waveWrite the rubber-band long before the fillThe case required four concurrent conditions for a long: a weekly descending wedge that had already resolved upward, heavy volume that marked a low then a new low, a stretched-from-value mean-reversion setup, and a high short-interest backdrop.
All readings on this track · 12 readings
  1. 2001Impulse-wave subcounts as a case-study filter
  2. 2006Wave 3 trend exits with pitchforks, channels, and Fibonacci
  3. 2006Four-leg Fibonacci reversal as an impulse wave checkpoint
  4. 2010An unfinished fifth wave blocked a second-wave count
  5. 2010Write the rubber-band long before the fill
  6. 2011A 5% trail cannot say whether the impulse-correction count is still alive
  7. 2012Wave counting as context before trade setups
  8. 2012A weekly-close test of impulse, correction, and the 61.8% stop
  9. 2013When wave templates fail under momentum override
  10. 2013Late momentum is a five-wave sentiment trap
  11. 2019Counting successive impulses after a productivity shock
  12. 2020Wave counts and Fibonacci targets as a falsifiable trade plan
By fieldWaves and ratios90 readingsBy year201075 readings
All 12 readings tagged Impulse wave
Also on Impulse wave5 readings
2001Impulse-wave subcounts as a case-study filter2012Wave counting as context before trade setups2013When wave templates fail under momentum override2019Counting successive impulses after a productivity shock2006Four-leg Fibonacci reversal as an impulse wave checkpoint