AWESOME GUIDE To Elliott Wave Correction Patterns and Rules!!

12/16/2020 AWESOME GUIDE to Elliott Wave Correction Patterns and Rules!! - BULLWAVES.
ORG
AWESOME GUIDE to Elliott Wave

Correction Patterns and Rules!!
by Enda Glynn | Feb 17, 2017
Elliott Wave Corrections are a hell of a thing!

During an Elliott Wave correction pattern the price
takes a long time to do absolutely nothing!
Correction patterns are hard to track, but these
patterns do follow rules.
Here they are:
Elliott Wave Correction Rules and Characteristics.
Rule 1: Wave 2 correction must not retrace more than 100% of wave 1.
Rule 2: Wave 4 must not cross into the price territory of wave 1 in an impulse wave,
but Wave 4 can overlap wave 1 in a leading or ending diagonal wave.
Rule 3: Wave alteration - If wave 2 is a deep correction - then wave 4 will be shallow.
Rule 4: Wave 2 will bottom in the price territory of the previous 4th wave of one lower
degree.
Rule 5: Corrections are always fully retraced by the resuming impulsive trend.
https://bullwaves.org/complete-guide-elliott-wave-correction-patterns/ 1/20
12/16/2020 AWESOME GUIDE to Elliott Wave Correction Patterns and Rules!! - BULLWAVES.ORG
Here's a short video on Elliott Wave correction patterns.
how to de ne a correction using elliott w…

w…
Here's the thing;

If you follow the rules and guidelines of Elliott wave
patterns.
You will be able to forecast the timing and possible
price targets, where the market could turn into a new
trend.
In total there are 13 major Elliott wave patterns.
I'm going to show you how to identify, and navigate
them using the Elliott wave rules, in this guide.
Here's the four types of Elliott Wave Corrective Patterns:
1: ABC ZIGZAG correction wave - 5,3,5 internal wave form.
2: ABC FLAT corrections - 3,3,5 internal wave form, regular and irregular types.
3: TRIANGLE ABCDE corrections - 3,3,3,3,3 internal wave form.
4: COMBINATION corrections - additive structure made from multiple simple

corrections.
ABC Correction Rules: 'ZIGZAG' (5-3-5)
A simple three-wave correction pattern labeled A-B-C, also called a ZIGZAG correction.
The ABC correction wave is the simplest of all Elliott wave correction patterns.
Here are the main Elliott wave rules for ABC corrections:
The ABC correction pattern subdivides into 5-3-5 internal wave pattern.
Waves A and C tend towards equality in length.
The ABC correction wave usually appears in the position of wave '2'.
An ABC correction wave will usually target the 61.8% retracement of the trend move.
Using these guidelines, you can estimate a possible ending point to wave C using the
length of wave A.
When the structure is complete and wave C has come to an end, A trader can place an
order at the end of wave B, expecting the price to turn back into trend again.
Simple ZIGZAG
Double ZIGZAG
This is a more complex version of the simple zigzag, the double zigzag forms when two
separate simple zigzags come together to form the larger structure.
Here are the main Elliott wave rules for double zigzag corrections:
The WXY correction pattern subdivides into 3-3-3 internal wave pattern.
Waves W and Y tend towards equality in length.
The WXY correction wave usually appears in the position of wave '4' or wave 'B'.
Using these guidelines, you can estimate a possible ending point to wave Y using the
length of wave W.
The notation is changed to di erentiate the complex version from the simple form.
To take advantage of this Elliott wave pattern a trader will use the same approach as
the simple zigzag, by placing an order at the end of wave (x), and when the price turns
back into the trend again you will catch the resuming trend.

ABC FLAT correction patterns (3-3-5)
An ABC at correction di ers from a zigzag in that the wave form traces out a 3-3-5
wave form, in general ABC at corrections retrace less than zigzags.
The more powerful the underlying trend, the shorter the at correction tends to be.
Here are the main Elliott wave rules for ABC Flat corrections:
The at correction pattern subdivides into 3-3-5 internal wave pattern.

Waves C tends towards 100% the length of wave A.
The at correction wave can appear in any corrective position.
An at correction wave will usually target the 50%% retracement level of the previous
move.
Using these guidelines, you can estimate a possible ending point to wave C using the
length of wave A.
Again, the trader can use the end of wave 'b' to enter the market and catch the
resumption of the trend move.
Simple Elliott wave at
Expanded at Elliott wave correction.

The expanding at Elliott wave pattern takes the same internal form as the normal at
correction pattern.
The only di erence being that the end of wave 'b' will travel past the beginning of wave
'a',
and the end of wave 'c', will travel past the end of wave 'a'.
This causes an expanding range in the at pattern, which increases the overall distance
traveled by the structure.
This pattern is also called an irregular at correction.
Here are the main Elliott wave rules for ABC expanded Flat corrections:
The expanded at correction pattern subdivides into 3-3-5 internal wave pattern.
Waves C tends towards 162% the length of wave A.
An at correction wave will usually target the 50%% retracement level of the previous
move.
A trader can use the starting point of wave 'a' to enter a trade,
with the aim of catching the market as it re-enters the trend move again.
Running at Elliott wave correction.

The running at Elliott wave pattern also has an internal 3,3,5 wave form similar to the
normal at correction pattern.
This classi es the pattern as a at correction.
The big di erence between a running at and a normal at correction,
is that wave 'b' will retrace more than 100% of wave 'a'.
And then, wave 'c' will fail to retrace 100% of wave 'a'.
So, a running at will complete in the direction of the larger trend.
In an uptrend wave 'c' will create a higher low.
And in a down trend, wave 'c' will create a lower high.
As shown in the image below.
Here are the main Elliott wave rules for running Flat corrections:
A running at correction subdivides into 3-3-5 internal wave pattern.

Wave 'B' breaks the beginning of wave 'A'.
Waves C tends towards 100% the length of wave A and will not break the low of wave
'A'.
The running at correction wave can appear in any corrective position.
Again, a trader can use the starting point of wave 'a' to enter a trade, with the aim of
catching the market as it re-enters the trend move again.
Although a running at is one of the trickiest patterns to call as it develops.
HORIZONTAL TRIANGLES, ABCDE patterns.

Here are the rules and guidelines for triangle waves:
Elliott wave triangles are overlapping ve wave corrections labeled ABCDE.

Triangle waves usually contract the range of price action from beginning to end.
Each internal wave takes a three wave form, and the triangle subdivides into a 3-3-3-
3-3 pattern.
An ABCDE pattern causes a sideways movement that is usually associated with
decreasing volume and volatility.
Elliott wave triangle waves usually occur in the position of wave B or wave 4 of the
larger pattern.
A triangle wave is usually the penultimate move in the larger Elliott wave pattern and
leads to an explosive move back into the larger trend.
Contracting triangle
The contracting triangle is a horizontal contraction in range of the price.
An Elliott wave triangle traces out ve internal moves each of three waves.
The distance traveled by each subsequent wave reduces in length.
This has the e ect of contracting the range of the wave, hence the name!
A low risk trade can be placed at the end of wave 'e' with the idea of catching the
market as it turns back into the trend.
Descending triangle
A descending triangle usually appears in a downtrend.
The lower bound of this Elliott wave triangle pattern holds in a at line while the top
trend line drops as usual, and the overall range of prices contracts.
A low risk trade can be placed at the end of wave 'e' with the idea of catching the
market as it turns back into the trend.
Ascending triangle
The ascending triangle usually appears in an uptrend.
The upper bounding trend line of this Elliott wave triangle pattern holds in a at line
and the lower trend line rises, and the overall range of prices contracts into wave 'e'.
Again, the same strategy applies, a low risk trade can be placed at the end of wave 'e'
with the idea of catching the market as it turns back into the trend.

Expanding triangle
An Elliott wave expanding triangle appears in both downtrends and up-trends.
The top trend line rises and the bottom trend line falls, and the overall range of prices
expands into wave 'e'.
This time the end of wave 'b' of the Elliott wave triangle is used to place a trend trade.
COMBINATION CORRECTIONS - double and triple 3.

A Elliott wave double or triple three combination, is a corrective Elliott wave pattern.
It happens when simpler wave forms stick together to form a larger structure.
For the most part, double threes and triple threes are horizontal in character.
There is never more than one zigzag in a combination wave, also there is never more
than one Elliott wave triangle.
All of the Elliott wave patterns shown above take the same form whether the trend
is rising or falling, in a falling trend, the image is simply inverted.
The best way to enter a trade o a combination structure is to place an order at the end
of wave 'x' and if the market crosses this point, it is likely that the trend has resumed
and you can ride that trend until its completion.
Remember;
Correction patterns are simply a pause within the larger
operating trend.
When corrections come to an end, prices usually explode back in the direct of the larger
trend.
Knowing how to tell a corrective wave pattern in the market from a trend wave, will help
you hold a position open for longer when you are riding a trend,
And it will help you enter the market at the correct time with low, and de ned risk
levels.
If you master Elliott wave correction patterns, you will be able to get in at the ground
oor and ride the trend until the end!
Elliott wave time analysis:

In the following video I go through how to identify if a trend or correction is 'mature' or
not.
The reason being;
When a trend is mature, it is time to look for a signal that the market is going to move
back in the direction of the larger trend.
This can be done using timing analysis along with elliott wave pattern analysis to gure
out the most likely area for a reversal to occur.
I know what your thinking!
" How do the Elliott wave rules of corrections help my trading? "
Here's one recent example, of how a completed correction led to a MASSIVE price
move.
And how a good knowledge of Elliott wave correction rules and market timing
helped us catch a 1200 point move!
CRUDE oil: Elliott wave analysis 10/26/17

On OCT 26th,
I saw a complete Elliott wave contracting triangle pattern in wave 'B' in CRUDE oil,
A completed correction suggested a larger rally dead ahead in CRUDE!
HERE IS the analysis, BLOW BY BLOW!
In my daily update on CRUDE oil,
The wave count was clear, and the potential for a huge rally was large.
Here's what I said!
"The current wave count sits at a very pivotal point 'in the price structure.
With a possible third of a third wave up, on the cards over the next few weeks."
Heres the chart from that day:
The wave count was calling for wave (C) to rally higher, out of a completed
Elliott wave triangle (B) wave pattern.
The price stood at 52.42 at the close that day,
And the initial target for wave (C) was set at 63.00,
which is an expected rally of 1100 points on o er,
and the Elliott wave pattern was clear!
"Watch for a short decline to complete wave (ii) grey.

At that point look for a bullish break of the wave (i) high to con rm wave (iii)."
Here's What happened next:
Over the following 10 weeks,

A textbook ve wave rally in wave (C) carried the market
1200 points higher,
to three year highs!
As this example shows,
Knowing when a corrective Elliott wave pattern is complete,
can increase your chances of catching the next trend move by a huge margin.
If you understand the Elliott wave rules and guidelines

for corrective patterns, you can use that knowledge to
increase your chances of a successful trade when the
correction ends.
And that is why Elliott wave patterns are so important
to understand.

Download this Guide to Correction Patterns:
If you want to know more about trading with Elliott

wave signals,
check out this guide:
How to use Elliott wave patterns in trading:
What are the Elliott wave abc correction rules.

Rule 1: Wave 2 correction must not retrace more than 100% of wave 1.
Rule 2: Wave 4 must not cross into the price territory of wave 1 in an impulse wave,
but Wave 4 can overlap wave 1 in a leading or ending diagonal wave.
Rule 3: Wave alteration - If wave 2 is a deep correction - then wave 4 will be shallow.
Rule 4: Wave 2 will bottom in the price territory of the previous 4th wave of one lower
degree.
Rule 5: Corrections are always fully retraced by the resuming impulsive trend.
What is an Elliott wave zigzag correction.

An Elliott wave zigzag correction is the simplest form of correction.
The pattern breaks into a 5,3,5 internal structure.
A zigzag correction usually creates retraces the largest amount of the previous trend
move.
What is an Elliott wave at correction.

An ABC at correction di ers from a zigzag in that the wave form traces out a 3-3-5
internal wave structure.
In general ABC at corrections retrace less than zigzags usually completing above the
50% retracement level.
The more powerful the underlying trend, the shorter the at correction tends to be.
Using these guidelines, you can estimate a possible ending point to the at correction.
What is an Elliott wave expanded at correction.

The expanded at Elliott wave pattern takes the same internal structural form as the
normal at correction pattern in that it breaks into a 335 pattern.
The big di erence between the two types of at correction is that in an expanded at,
the end of wave 'b' will travel past the beginning of wave 'a',
and the end of wave 'c', will travel past the end of wave 'a'.
This causes an expanding range in the at pattern, which increases the overall distance
traveled by the structure.
What are the rules of an Elliott wave expanded at correction.

Here are the main Elliott wave rules for ABC expanded Flat corrections:
1: The expanded at correction pattern subdivides into 3-3-5 internal wave pattern.
2: Waves C tends towards 162% the length of wave A.
3: The at correction wave can appear in any corrective position.
4: A at correction wave will usually retrace about 50% of the previous move.
What are the main Elliott wave at correction rules.

Here are the main Elliott wave rules for ABC Flat corrections:
1: The at correction pattern subdivides into 3-3-5 internal wave pattern.
2: Waves C tends towards 100% the length of wave A.
3: The at correction wave can appear in any corrective position.
4: A at correction wave will usually target the 50% level of the previous move.
What is an irregular correction in Elliott wave theory.

An Elliott wave irregular correction refers to a at correction that has failed to complete
a normal pattern, it is also called an Elliott wave running correction.
The irregular or running at Elliott wave pattern has an internal 3,3,5 wave form similar
to the normal at correction pattern.
This classi es the pattern as a at correction.
The big di erence between a running at and a normal at correction,

is that wave 'b' will retrace more than 100% of wave 'a'.
And then, wave 'c' will fail to retrace 100% of wave 'a'.
With this failure in wave 'c' an irregular correction will complete in the direction of the
larger trend.
In an uptrend wave 'c' will create a higher low.
And in a down trend, wave 'c' will create a lower high.
As shown in the image below.
Here are the main Elliott wave rules for running Flat corrections:
1: A running at correction subdivides into 3-3-5 internal wave pattern.
2: Wave 'B' breaks the beginning of wave 'A'.
3: Waves C tends towards 100% the length of wave A and will not break the low of wave
'A'.
4: The running at correction wave can appear in any corrective position.
What is an Elliott wave correction target.

A typical target area for an Elliott wave correction is 50% of the preceding impulsive
move.
This is a common rule of thumb for what to expect in a correction.
But Correction targets can vary wildly in how much of the advance that they retrace.
Usually a zigzag 5,3,5 correction will retrace deeper into the trend move than a at
correction.
Fibonacci analysis is very helpful in nding targets for a correction.
What is an Elliott wave combination correction.

Elliott wave double or triple three corrections are corrective structures known as
combination corrections.
It happens when simpler wave forms stick together to form a larger more complicated
structure.
These types of correction occur quite often and for the most part, double threes and
triple threes are horizontal in nature.
A combination wave will tend to delay the action and cause a trading range appear.
There is never more than one zigzag in a combination wave, also there is never more
than one Elliott wave triangle in a combination.
A combination correction can also called an Elliott wave complex correction or an Elliott
wave wxy correction.
What types of Elliott wave correction patterns are there.

1: ABC ZIGZAG correction wave - 5,3,5 internal wave form.
2: ABC FLAT corrections - 3,3,5 internal wave form, regular and irregular types.
3: TRIANGLE ABCDE corrections - 3,3,3,3,3 internal wave form.
4: COMBINATION corrections - additive structure made from multiple simple

corrections.
What is an Elliott wave abc correction.
The Elliott wave abc correction is a three wave pattern that causes a pause against the
movement of price in one direction.
The abc correction can break into a number of di erent internal patterns the main ones
are the simple zigzag 535 pattern and the at 335 correction.
What is an Elliott wave diagonal triangle correction.

A diagonal triangle correction is also known as an abcde correction and they can trace
out four di erent forms, the contracting triangle, the expanding triangle, the ascending
triangle and the descending triangle.
The triangle usually causes a horizontal contraction in range of the price.

An Elliott wave triangle traces out ve internal moves each of three waves.
The distance traveled by each subsequent wave reduces in length.
This has the e ect of contracting the range of the wave, hence the name!
Here are the rules and guidelines for triangle waves:

1: Elliott wave triangles are overlapping ve wave corrections labeled ABCDE.
2: Triangle waves usually contract the range of price action from beginning to end.
3: Each internal wave takes a three wave form, and the triangle subdivides into a 3-3-3-
3-3 pattern.
4: An ABCDE pattern causes a sideways movement that is usually associated with
decreasing volume and volatility.
5: Elliott wave triangle waves usually occur in the position of wave B or wave 4 of the
larger pattern.
4: A triangle wave is usually the penultimate move in the larger Elliott wave pattern and
leads to an explosive move back into the larger trend.
What is an Elliott wave 4 correction.

A wave 4 correction occurs as the penultimate move in a regular ve wave impulse
pattern.
Wave '4' is usually a sideways ranging pattern like a combination correction or a triangle
correction.
Wave '4' will usually alternate in form to the previous wave 2 correction so they do not
take the same form.
Here are some rules associated with wave '4'.

1: Elliott wave triangle waves usually occur in the position of wave B or wave 4 of the
larger pattern.
2: wave 4 should not overlap the top of wave 1.
3: wave 4 should lead to an explosive move back in the direction of the trend.
4: wave '4' is usually a sideways ranging pause in the larger trend.
5: wave 4 will usually form the initial support level for any proceeding correction within
the larger trend.
Can Wave 4 overlap wave 1.

Normally wave 4 must not cross into the price territory of wave 1 in a regular impulse
wave.
But Wave 4 will overlap the top of wave 1 in a leading or ending diagonal wave.
Can Wave 2 be a triangle?

Wave 2 in a normal impulsive ve wave pattern can not be a triangle wave.
A wave 2 correction is usually either a simple zigzag wave or a at correction.
The reason it will not take the form of a triangle seems to be that a triangle does not
retrace enough of the preceding advance that a second wave requires.
Wave 2 is a disbelief correction, meaning that the rally is not trusted so the correction is
deep.
while a triangle is a belief correction, meaning that it is usually shallow and sideways in
nature which does not destroy the conviction of the rally.
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12/16/2020 AWESOME GUIDE to Elliott Wave Correction Patterns and Rules!! - BULLWAVES.

AWESOME GUIDE to Elliott Wave

Elliott Wave Corrections are a hell of a thing!

Here's a short video on Elliott Wave correction patterns.

how to de ne a correction using elliott w…

Here's the thing;

1: ABC ZIGZAG correction wave - 5,3,5 internal wave form.

3: TRIANGLE ABCDE corrections - 3,3,3,3,3 internal wave form.

4: COMBINATION corrections - additive structure made from multiple simple

ABC Correction Rules: 'ZIGZAG' (5-3-5)

The at correction pattern subdivides into 3-3-5 internal wave pattern.

Simple Elliott wave at

Expanded at Elliott wave correction.

This pattern is also called an irregular at correction.

Running at Elliott wave correction.

This classi es the pattern as a at correction.

The big di erence between a running at and a normal at correction,

So, a running at will complete in the direction of the larger trend.

In an uptrend wave 'c' will create a higher low.

And in a down trend, wave 'c' will create a lower high.

As shown in the image below.

A running at correction subdivides into 3-3-5 internal wave pattern.

Although a running at is one of the trickiest patterns to call as it develops.

HORIZONTAL TRIANGLES, ABCDE patterns.

Elliott wave triangles are overlapping ve wave corrections labeled ABCDE.

COMBINATION CORRECTIONS - double and triple 3.

Elliott wave time analysis:

The reason being;

I know what your thinking!

CRUDE oil: Elliott wave analysis 10/26/17

A completed correction suggested a larger rally dead ahead in CRUDE!

HERE IS the analysis, BLOW BY BLOW!

In my daily update on CRUDE oil,

Here's what I said!

Heres the chart from that day:

The price stood at 52.42 at the close that day,

which is an expected rally of 1100 points on o er,

and the Elliott wave pattern was clear!

"Watch for a short decline to complete wave (ii) grey.

Here's What happened next:

Over the following 10 weeks,

Knowing when a corrective Elliott wave pattern is complete,

If you understand the Elliott wave rules and guidelines

Download this Guide to Correction Patterns:

If you want to know more about trading with Elliott

What are the Elliott wave abc correction rules.

What is an Elliott wave zigzag correction.

What is an Elliott wave at correction.

What is an Elliott wave expanded at correction.

What are the rules of an Elliott wave expanded at correction.

What are the main Elliott wave at correction rules.

What is an irregular correction in Elliott wave theory.

The big di erence between a running at and a normal at correction,

What is an Elliott wave correction target.

What is an Elliott wave combination correction.

What types of Elliott wave correction patterns are there.

4: COMBINATION corrections - additive structure made from multiple simple

What is an Elliott wave diagonal triangle correction.

The triangle usually causes a horizontal contraction in range of the price.

Here are the rules and guidelines for triangle waves:

What is an Elliott wave 4 correction.

Here are some rules associated with wave '4'.