SECTION 1 — Foundations
1.1 What Elliott Wave Theory is
Elliott Wave Theory describes market movement as repeating fractal sequences driven by crowd behavior, where trends progress in motive phases and correct in counter-trend phases. Your job is not to “predict”; your job is to classify what price is doing now, then maintain only counts that remain structurally valid.
The theory is probabilistic, not deterministic. Multiple valid counts can exist simultaneously, but only those that respect the rules and guidelines should be considered. Over time, price action will confirm or invalidate these possibilities.
1.2 Why structure matters more than indicators
Indicators can describe momentum or volatility, but they do not tell you whether the market is building an impulse, a diagonal, or a correction. Elliott Wave analysis is primarily a pattern-recognition and validation discipline: the count is either structurally permissible or it isn’t.
Structure provides context. Without knowing the structural position of price, indicator signals lack directional meaning. When structure is defined first, indicators may be used as secondary tools for timing rather than as primary decision-makers.
1.3 Motive vs corrective behavior
Motive waves tend to be directional, persistent, and “hard to fade.” Corrective waves tend to overlap, rotate, and consume time relative to price progress. Use this behavioral difference as your first filter before attempting labels.
Focus on how price moves, not how far it moves. Motive behavior shows commitment and follow-through, while corrective behavior shows hesitation, retracement, and structural complexity. If price action does not clearly express motive intent, treat it as corrective by default.
1.4 Degrees of trend
Waves unfold in degrees (grand supercycle down to subminuette). Degree is not defined by a fixed timeframe; it is defined by relative size, internal subdivision, and how the wave relates to surrounding structure.
Degree must remain consistent. A wave of one degree must subdivide into smaller-degree structures and integrate into larger-degree context. Mixing degrees or forcing labels across mismatched scales is a primary source of invalid counts.
1.5 Fractal nature (practical meaning)
Fractal does not mean “anything fits.” It means the same structural rules apply at all degrees. If a count violates rules at any degree, it is invalid at all degrees.
Every wave must follow the same principles of motive and corrective behavior, subdivision, and placement. Structural integrity at one degree supports consistency across all degrees.
1.6 A rules-based workflow (core discipline)
Use this sequence consistently:
- Identify whether the segment is more likely motive or corrective.
- Propose the simplest structure that fits without rule violations.
- Define invalidation levels first (what must not happen).
- Define confirmation conditions second (what should happen next if you are right).
- If price violates rules, relabel immediately; do not “reinterpret” the rules.
This workflow emphasizes discipline over opinion. Separating invalidation from confirmation prevents bias from shaping counts and keeps analysis objective and repeatable.
SECTION 2 — Motive (Impulsive) Structures
2.1 Definition and purpose
A motive structure advances price in the direction of the trend of the next larger degree. It is the market’s “progress engine” and is typically the segment that must be present for a trend to exist.
Motive waves provide both directional guidance and structural context. They define the market’s dominant intent and set the stage for subsequent corrective phases. Recognizing motive segments early helps identify valid wave counts and anticipate potential termination zones.
2.2 Core rules (non-negotiable)
A standard impulse must satisfy the following:
- Wave 2 must not retrace beyond the start of wave 1.
- Wave 4 must not enter wave 1 price territory (in a standard impulse).
- Wave 3 must extend beyond wave 1’s end and must not be the shortest among waves 1, 3, and 5.
- Waves 1, 3, and 5 subdivide into motive form (classically five-wave behavior).
If any of these fail, you do not have a standard impulse; consider a diagonal or a corrective structure.
2.3 Rules vs guidelines (keep them separate)
Rules (must hold):
- Price constraints (e.g., wave 2 cannot exceed wave 1 start).
- Non-overlap in standard impulses (wave 4 cannot enter wave 1).
- Wave 3 not shortest among 1/3/5.
Guidelines (often, not always):
- Alternation between waves 2 and 4 (form, depth, time).
- Equality between wave 1 and wave 5, or wave A and wave C.
- Typical Fibonacci relationships (common, not mandatory).
2.4 Internal wave characteristics (1 through 5)
2.4.1 Wave 1
Purpose: First directional push that breaks from prior corrective balance.
Typical depth (retraced by wave 2): Often substantial; wave 2 commonly retraces 50–61.8% of wave 1.
Subdivision: Must be motive in character, but can be choppy at small degree early in trends.
Common mistakes: Labeling any strong move as wave 1 without confirming wave 2 behavior.
Validation conditions: Subsequent pullback (wave 2) holds above wave 1 start (bull) or below wave 1 start (bear).
Invalidation conditions: Any retrace beyond wave 1 start invalidates a wave 1–2 sequence for an impulse at that degree.
Psychology: Early participation; disbelief remains high.
2.4.2 Wave 2
Purpose: Deep retracement that tests whether wave 1 was real.
Typical depth: Often 50–61.8% of wave 1; can be deeper, but must not exceed wave 1 start.
Subdivision: Corrective (3-wave or complex corrective).
Common mistakes: Calling a wave 2 “too deep” and forcing an alternate when rule has not broken.
Validation conditions: The correction stays corrective (overlapping, three-wave behavior) and ends without breaking wave 1 origin.
Invalidation conditions: Break of wave 1 start is decisive invalidation.
Psychology: “The trend is over” narrative dominates; professionals look for structure completion.
2.4.3 Wave 3
Purpose: Trend expansion phase; normally strongest.
Typical relationship: Often 161.8–423.6% of wave 1 (guideline).
Subdivision: Must be motive; internal subdivisions should be clearer than wave 1.
Common mistakes: Labeling a wave 3 when it overlaps and behaves corrective; mis-sizing degree.
Validation conditions: Wave 3 must exceed wave 1 end and cannot be shortest among 1/3/5.
Invalidation conditions: If your proposed wave 3 is shortest, the impulse count is invalid.
Psychology: Broad recognition; pullbacks are bought/sold aggressively.
2.4.4 Wave 4
Purpose: Consolidation after expansion.
Typical depth: Often 23.6–38.2% of wave 3 (rarely deeper in classic impulses).
Subdivision: Corrective; often sideways/complex compared to wave 2 (alternation guideline).
Common mistakes: Forcing a wave 4 when price enters wave 1 territory (standard impulse violation).
Validation conditions: Holds above wave 1 price territory (standard impulse).
Invalidation conditions: Entry into wave 1 territory invalidates a standard impulse at that degree; consider diagonal or relabel degree.
Psychology: Profit-taking; trend followers remain committed.
2.4.5 Wave 5
Purpose: Final motive push; can be strong or weak.
Typical relationship: Often equality with wave 1, or 61.8% of 1–3, or 161.8% of wave 1 (guideline).
Subdivision: Motive.
Common mistakes: Assuming wave 5 “must” make a new extreme with strong momentum.
Validation conditions: A completed 5-wave structure followed by a meaningful reversal or multi-wave retracement is consistent with completion.
Invalidation conditions: If you cannot count five waves or the internal behavior is consistently corrective, you likely do not have a wave 5.
Psychology: Late participation; risk increases; trend may “look strongest” even as structure nears completion.
2.5 Standard impulse (5-wave motive)
Acceptable when:
- All impulse rules are satisfied.
- Internal subdivisions are consistent with motive behavior.
- Corrections (2 and 4) are corrective and proportional.
Questionable when:
- Wave 4 repeatedly overlaps wave 1 territory (suggests diagonal or wrong degree).
- “Wave 3” looks weak and overlapping.
- The supposed impulse takes excessive time with little net progress (often corrective).
Invalid when:
- Wave 2 breaks wave 1 start.
- Wave 4 enters wave 1 territory (standard impulse).
- Wave 3 is shortest among 1/3/5.
2.6 Diagonals (motive, but not standard impulses)
Diagonals are motive structures with wedge boundaries and overlapping tendencies. They commonly appear as:
- Leading diagonal in wave 1 or wave A positions.
- Ending diagonal in wave 5 or wave C positions.
Diagonals differ from standard impulses because their internal waves can appear corrective or overlapping, yet the overall structure still advances the trend. Recognizing diagonals early prevents mislabeling and ensures the impulse count remains structurally valid.
2.6.1 Leading diagonal
Key idea: A motive start with diagonal personality; often looks like a wedge that still progresses.
Placement: Wave 1 or A.
Common internal character: Overlap and corrective-looking subwaves are more tolerated than in a standard impulse.
Validation focus: Boundaries (wedge lines), five segments, and correct placement context.
Leading diagonals often indicate the **early-stage commitment** of a new trend. Internal irregularities are permissible as long as the structure respects wedge boundaries and degree rules.
2.6.2 Ending diagonal
Key idea: Terminal motive move with corrective internals.
Placement: Wave 5 or C positions.
Internal subdivision: Commonly described as 3-3-3-3-3 (each leg is a corrective “three”).
Structural hallmark: Wedge form; overlap is typical; wave 3 cannot be the shortest among 1/3/5.
Expectation: Terminal patterns often precede sharp reversals once complete, because the pattern represents exhaustion into the end.
Ending diagonals indicate **trend exhaustion**. Traders should anticipate that the subsequent correction will be significant and that the pattern represents a final push rather than a sustained impulse.
Acceptable when:
- It appears in a valid terminal position (wave 5 or C).
- You can segment five legs and the move fits wedge boundaries.
- Subwaves look corrective rather than impulsive.
Invalid when:
- You are trying to place it in wave 3 position.
- The segmentation does not resolve into five legs or loses wedge form.
2.7 Extended wave behavior
An extension occurs when one motive wave unfolds substantially longer and with more internal subdivision than the others. Most frequently, extension appears in wave 3 in classic impulses.
Validation focus:
- Maintain the impulse rules; an extended wave does not excuse violations in wave structure or degree.
- Use proportionality: the extended wave should be obviously dominant, not marginally longer than other waves.
- Check internal subdivisions: the extension should show clear motive segments and maintain impulsive character.
Common mistake:
Using “extension” as an excuse to ignore unclear subdivision or mislabel corrective-looking segments.
2.8 Truncations (failures)
A truncation occurs when wave 5 fails to exceed wave 3's end (in an uptrend, wave 5 makes no new high; in a downtrend, no new low). This signals weakening momentum into completion and often precedes a strong reversal.
Acceptable when:
- You still have a complete 5-wave structure that respects internal subdivisions.
- Wave 5 subdivides properly despite ending early.
Common mistake:
Labeling truncation when wave 5 is simply unfinished or miscounted. Always confirm degree and internal motive subdivisions before assuming failure.
2.9 Channeling techniques (structure management, not prediction)
Channeling helps you test whether your motive count is behaving correctly and helps locate likely termination zones.
Use these classical channel types (apply consistently, don't improvise):
Base channel: from wave 1 start to wave 2 end, parallel through wave 1 end. Wave 3 often breaks out; wave 4 often respects boundaries.
Acceleration channel (1–3): connect wave 1 end to wave 3 end, parallel from wave 2 end; helps identify wave 3 exhaustion and wave 4 behavior.
Elliott channel (2–4): connect wave 2 end to wave 4 end, parallel through wave 3 end; wave 5 often terminates near the outer parallel.
Validation use:
- If price violates a channel behavior repeatedly, your degree or structure is likely wrong.
- Channels support counts; they do not prove counts. Use them as **confirmation tools**, not as the primary label determinant.
- Check channel alignment with wave expectations (e.g., extensions, truncations, diagonals) for structural consistency.
SECTION 3 — Corrective Structures (Overview)
3.1 Why corrections exist
Corrections are how markets rebalance after directional progress. They relieve overextension, rotate sentiment, and rebuild capacity for the next motive wave.
Understanding corrections is critical because they define the context for the next impulse. Corrective behavior signals pauses, consolidation, and potential areas of accumulation or distribution.
3.2 Simple vs complex corrections
Simple corrections: One primary corrective pattern, such as a zigzag, flat, or triangle. These are typically easier to identify and validate due to clear subdivisions and boundaries.
Complex corrections: Combinations of patterns joined by connectors (W–X–Y, W–X–Y–X–Z). Complex corrections are more time-consuming, often span multiple degrees, and require careful segmentation to maintain structural validity.
3.3 Time vs price behavior
Corrections are frequently more time-consuming relative to the price distance they cover. If the market is “busy” but not progressing, assume corrective behavior until proven otherwise.
Focus on pace and rotation rather than absolute price movement. Corrections tend to overlap previous waves, exhibit sideways or irregular motion, and can contain nested corrective subwaves. Misinterpreting time-heavy behavior as motive is a common labeling error.
3.4 Depth and proportionality (the correction must “fit”)
A correction should be proportional to the motive wave it corrects in both:
- Price retracement (depth): The corrective move should make sense relative to the size of the motive wave.
- Time consumption (duration): The corrective phase often consumes as much or more time than the preceding motive wave.
If your wave 2 is tiny and your wave 4 is enormous (or vice versa) without a reasonable alternation or proportionality, the count is likely invalid. Always check for symmetry between corrective phases to maintain structurally sound labeling.
SECTION 4 — Simple Corrections
4.1 Zigzag (5-3-5)
Definition: A sharp correction with strong wave A and C moving against the prior trend, separated by a smaller wave B.
Structure: A = 5, B = 3, C = 5.
Personality: Fast, directional correction; often appears in wave 2 or as wave A of larger corrections.
Rules (minimum structure):
- Wave A and C must be motive; B must be corrective.
Fibonacci tendencies:
- Wave B often retraces a portion of A.
- Wave C often equals or extends A (0.618×A or 1.618×A typical).
Validation conditions:
- A and C are motive and do not overlap like a triangle.
- Overall movement is sharp, not sideways.
Disqualification triggers:
- Persistent overlap and sideways drift indicate flat or combination.
Outcome guideline: Usually precedes continuation in the original trend.
Zigzag Confirmation Rule
The price action after wave C completes confirms the zigzag if it breaks the O–B trendline (from origin O to wave B) in equal time or faster than wave C took. This validates the pattern's end and often signals correction completion with trend resumption ahead.
Timing Logic
Wave C sets the benchmark as the final leg; "post" action must match or beat its speed for confirmation, aligning with standard Elliott Wave guidelines. Confirmation can't occur "pre" pattern completion.
4.2 Flat (3-3-5)
Definition: A sideways corrective structure in which both Wave A and Wave B unfold as corrective formations, followed by a motive Wave C. Flats represent a pause or redistribution phase within a larger trend rather than a true trend reversal.
Structure: A = 3, B = 3, C = 5.
Personality: Sideways, overlapping, congestive; repeated false breaks inside a range. Commonly forms in strong trends and corrects more through time than price.
Contextual behavior: Most often appears as Wave 4 or Wave B. Typically follows strong impulsive movement.
4.2.1 Regular flat
Wave B retraces approximately 90%–100% of Wave A.
Wave C often terminates near the end of Wave A.
Typical Fibonacci guidelines:
- Wave B ≈ 0.90–1.05 × Wave A
- Wave C ≈ 0.90–1.10 × Wave A
Personality: Balanced, horizontal range, controlled volatility.
Trading note: Best opportunity often appears near completion of Wave C.
4.2.2 Expanded flat
Wave B exceeds the start of Wave A.
Wave C travels beyond the end of Wave A.
Typical Fibonacci guidelines:
- Wave B ≈ 1.05–1.38 × Wave A
- Wave C ≈ 1.236–1.618 × Wave A
Personality: Deceptive, produces strong false breakouts.
Trading note: Avoid chasing Wave B breakouts; reversal often occurs after Wave C exhaustion.
4.2.3 Running flat
Wave B exceeds the start of Wave A.
Wave C fails to reach the end of Wave A (truncated).
Typical Fibonacci guidelines:
- Wave B ≈ 1.05–1.38 × Wave A
- Wave C ≈ 0.618–0.90 × Wave A
Personality: Indicates very strong underlying trend; correction resolves quickly.
Trading note: Expect sharp continuation after completion.
Validation:
- Wave A subdivides as corrective.
- Wave B is corrective and overlaps Wave A.
- Wave C subdivides into five waves.
- Overall structure is sideways rather than directional.
Disqualification:
- Wave A is five-wave motive → likely zigzag.
- Contracting five-leg overlap → likely triangle.
Outcome guideline: After Wave C completes, expect decisive breakout with expanding momentum.
SECTION 5 — Complex Corrections
Complex corrections are combinations of simpler corrective patterns linked together by connector waves (X). Their purpose is to extend a correction in time rather than produce directional price movement.
Core principle: When a market fails to produce a clean impulse after an apparent correction, assume the correction is still developing.
5.1 Double three (W–X–Y)
Definition: Two corrective patterns joined by a connector wave (X).
Structure: W = corrective, X = connector, Y = corrective.
Personality: Sideways, overlapping, time-consuming; frustrates directional expectations.
Contextual behavior: Frequently appears as Wave 4 or Wave B. Extends consolidation after a strong impulse.
Common practice: W is rarely a triangle; triangles more often appear as terminal components (Y).
Recognition characteristics:
- A correction appears complete, but price fails to trend.
- Overlap continues and another corrective structure develops.
- No sustained impulsive breakout occurs.
Typical relationships (guidelines):
- W and Y often similar in duration.
- X typically smaller than W and Y.
Validation:
- W and Y are identifiable corrective patterns (zigzag, flat, triangle, or combination).
- X subdivides as corrective.
- Overall behavior remains sideways.
Disqualification:
- Any segment becomes a clear impulse.
- Sustained breakout with follow-through.
- Extreme disproportion between W and Y without higher-degree justification.
Outcome guideline: After Y completes, expect decisive move in the direction of the larger trend.
Trading note: Avoid aggressive trend entries until Y shows signs of completion.
5.2 Triple three (W–X–Y–X–Z)
Definition: Three corrective patterns connected by two X waves.
Structure: W, Y, Z = corrective; X waves = connectors.
Personality: Extremely time-consuming, deeply overlapping, mentally exhausting.
Contextual behavior: Most often appears in large-degree Wave 4 or Wave B positions.
Recognition characteristics:
- Market continues correcting after a double three should have ended.
- Another connector forms and an additional corrective structure develops.
Typical relationships (guidelines):
- W, Y, Z relatively similar in scale.
- X waves remain smaller than adjacent corrections.
Validation:
- Each component is a complete corrective pattern.
- X waves remain corrective and non-impulsive.
- Overall structure maintains sideways character.
Disqualification:
- X wave becomes impulsive.
- Sustained breakout occurs.
- Simpler count remains valid (prefer simpler interpretation).
Practical guideline: Use triple three only when double three fails.
Outcome guideline: Final Z wave completion is often followed by strong trending movement.
SECTION 6 — Triangles
Triangles are terminal corrective structures composed of five overlapping segments labeled A–B–C–D–E. They represent consolidation and energy compression before a final directional move.
6.1 Triangle definition
Definition: A five-segment corrective pattern labeled A–B–C–D–E where each segment subdivides as corrective.
Core structure guideline: 3-3-3-3-3.
Personality: Compression, decreasing momentum, persistent overlap, lack of follow-through.
Contextual behavior: Most commonly appears as Wave 4 or Wave B. Rarely appears as Wave 2.
6.2 Recognition characteristics
- Price oscillates between converging or defined boundaries.
- Each swing is smaller or similar in magnitude.
- No swing shows sustained impulsive behavior.
Typical duration: Triangles tend to consume more time than price.
6.3 Triangle types and distinguishing traits
6.3.1 Contracting triangle
Boundary behavior: Converging trendlines.
Personality: Diminishing volatility.
Outcome guideline: Often followed by a strong thrust in the direction of the larger trend.
6.3.2 Expanding triangle
Boundary behavior: Diverging trendlines.
Personality: Increasing volatility.
Outcome guideline: Resolution still follows larger trend despite wider swings.
6.3.3 Barrier triangle
Boundary behavior: One boundary relatively flat, the other sloping.
Personality: Difficult to confirm early.
Outcome guideline: Thrust typically breaks in direction of prior trend.
6.3.4 Running triangle
Boundary behavior: Biased structure.
Personality: Underlying trend is strong.
Outcome guideline: Thrust may be brief because much of the movement occurred within the triangle.
6.4 Typical relationships (guidelines)
- Waves within the triangle are often similar in duration.
- No leg should be dramatically larger than the others.
6.5 Validation conditions
- Five distinct legs labeled A–B–C–D–E.
- Each leg subdivides as corrective.
- Persistent overlap.
- Price respects triangle boundaries.
6.6 Disqualification triggers
- Any leg subdivides as a clear impulse.
- Sustained breakout before five legs complete.
- More than five legs → likely a combination.
6.7 Practical trading notes
- Avoid trading inside triangles.
- Focus on post-triangle thrust.
- Expect faster movement once price exits.
SECTION 7 — Advanced Structural Guidelines
These guidelines are not strict rules. However, consistent application materially improves count quality, reduces subjective bias, and helps eliminate structurally weak interpretations.
7.1 Alternation
Alternation suggests wave 2 and wave 4 tend to differ in at least one of the following:
- Depth (deep vs shallow)
- Form (zigzag vs flat/triangle)
- Complexity (simple vs complex)
- Time consumption (fast vs slow)
Practical use:
If wave 2 was sharp and deep, expect wave 4 to be sideways, overlapping, or complex. If wave 2 was complex, expect wave 4 to be simpler. Alternation is a filtering guideline, not an obligation.
Warning:
If wave 2 and wave 4 look nearly identical in depth, form, and time, question your degree or structure.
7.2 Equality and proportionality
Equality most commonly appears between:
- Wave 1 and wave 5
- Wave A and wave C
In strong extensions, non-extended waves often relate by equality or simple Fibonacci ratios.
Practical use:
Equality provides targeting zones and plausibility checks. It does not validate a count by itself.
Warning:
If one wave is dramatically larger or smaller without justification, reassess degree or labeling.
7.3 Extension relationships
In an impulse, typically only one of waves 1, 3, or 5 extends.
Characteristics of a true extension:
- Clearly dominant in price distance
- Shows greater internal subdivision
- Visually stands out
Practical use:
If your supposed extension is only marginally longer than the others, it is probably not an extension. Degree selection is likely incorrect.
7.4 Depth symmetry
Corrections commonly retrace into shared zones such as:
- 38.2%
- 50%
- 61.8%
In strong trends, wave 4 often retraces less than wave 2.
Practical use:
Use retracement symmetry to reject implausible counts, not to force targets.
7.5 Time symmetry
Corrective waves often consume more time than motive waves of similar price distance.
Practical use:
If a wave takes a long time, overlaps heavily, and produces limited net progress, treat it as corrective unless proven otherwise.
Warning:
Do not label slow, overlapping structures as impulses simply because price eventually moves.
7.6 Momentum and persistence behavior
Even without indicators, compare:
- Rate of travel
- Continuity of movement
- Frequency of overlap
Motive waves: Travel farther with fewer interruptions.
Corrective waves: Show frequent overlap, rotation, and hesitation.
Terminal patterns (ending diagonals, truncations) commonly display weakening persistence into completion and often subdivide 3-3-3-3-3.
7.7 Degree consistency
All internal subdivisions must align with the same degree hierarchy.
Practical use:
Avoid mixing very small-degree waves inside large-degree labels without clear subdivision logic.
Warning:
If maintaining a count requires repeatedly changing degree assignments, the structure is likely wrong.
7.8 Structural hierarchy priority
When conflicts arise, prioritize in this order:
- Hard rules
- Structure
- Proportionality
- Guidelines
- Indicators (optional)
Indicators may support a count, but they never override structural rules.
SECTION 8 — Common Counting Errors
8.1 Forcing impulses
- If wave 4 overlaps wave 1 repeatedly, stop calling it a standard impulse.
- If subdivisions do not resolve cleanly, reduce degree or reclassify as corrective.
- Do not assume every directional move must be impulsive.
Reminder:
Motive character must be proven by structure, not by slope or speed.
8.2 Mislabeling wave 3
Wave 3 must not be the shortest among waves 1, 3, and 5 in an impulse.
Practical rule:
If your proposed wave 3 is shorter than wave 1 and wave 5, the count is invalid—do not "adjust" labels to preserve the narrative.
Additional filter:
Wave 3 normally displays the clearest internal subdivision and strongest persistence.
8.3 Treating all corrections as zigzags
Sideways overlap is not a zigzag.
If price rotates, overlaps, and consumes time with limited net progress, default to:
- Flat
- Triangle
- Combination
until proven otherwise.
Reminder:
Zigzags are sharp and directional. If it feels slow and messy, it probably is not a zigzag.
8.4 Ignoring invalidation
A valid wave count must have a clearly defined invalidation level.
Practical test:
If you cannot state the invalidation in one sentence, the count is not disciplined enough to use.
Warning:
Relabel immediately when invalidation occurs. Do not reinterpret rules to keep a favorite count alive.
SECTION 9 — Practical Application
9.1 Top-down analysis workflow
- Start at a higher timeframe to identify likely degree and primary trend.
- Mark the last completed motive or corrective structure.
- Drop one timeframe and label internal subdivisions.
- Define invalidation and confirmation for each scenario.
- Maintain at least two counts: primary and alternate.
- Trade decisions (if any) come after structure validation, never before.
9.2 Multiple timeframe alignment
Your lower timeframe count should logically subdivide the higher timeframe count.
If they disagree structurally:
- Your degree selection is wrong, or
- You are counting noise as structure.
Rule:
Lower timeframe detail must support higher timeframe structure—not contradict it.
9.3 When not to act (structure-based)
Avoid involvement when:
- The market is in a late-stage complex correction or triangle.
- Your count lacks clean invalidation.
- The best fit requires multiple rule exceptions.
- Internal behavior is contradictory or unclear.
Capital preservation is a valid position.
9.4 Elliott Wave as a bias framework
Use Elliott Wave to define:
- Whether price is progressing (motive) or balancing (corrective)
- What structure is likely unfolding
- What must happen next for the count to remain valid
Do not use Elliott Wave as a license to forecast without structural evidence.
The goal is alignment with structure, not prediction.
SECTION 10 — Summary & Study Plan
10.1 How to practice effectively
- Practice identifying motive vs corrective behavior first; apply labels second.
- Drill impulse rules until violations are recognized instantly.
- Study invalidations more than confirmations; invalidation teaches structure fastest.
- Save charts and annotate why counts failed as well as why they worked.
- Recount the same chart weeks later and compare improvement.
Core principle:
Skill develops through error review, not through perfect counts.
10.2 Chart marking routine (repeatable)
- Mark major swings.
- Identify likely motive or corrective behavior.
- Propose simplest valid structure.
- Write invalidation level.
- Write confirmation conditions.
- Reassess after each meaningful swing completes.
This routine converts chart time into structured training.
10.3 Skill progression roadmap
- Master standard impulses and basic zigzags.
- Add flats (regular, expanded, running).
- Add triangles (recognition and placement).
- Add combinations (W–X–Y logic).
- Refine proportionality, alternation, and time-based filters.
- Develop multi-timeframe consistency.
Do not advance layers until earlier layers are consistently accurate.
Appendix — Key reference definitions (quick)
Motive wave: A trend-advancing structure that moves price in the direction of the next larger degree; classically subdivides into five waves.
Corrective wave: A counter-trend or balancing structure that relieves prior movement; typically subdivides into three-wave patterns or combinations.
Ending diagonal: A terminal motive structure appearing in wave 5 or C positions, commonly described as 3-3-3-3-3 internally and signaling exhaustion.
Invalidation: A specific price level whose breach proves the proposed count wrong.
Confirmation: Structural behavior that increases confidence in a count, without proving it.
Note: This page is hard-coded inside templates/template-ew-manual.php. To edit wording, update the HTML string in the template.