Corrective Structures.
Overview. "Correction through time"
Corrective waves 2 and 4 tend to alternate in shape, complexity and depth. As you can see on the chart above, wave 2 can have a Simple Zig-Zag structure and be deep retracing substantial part of preceding rally in wave 1. Then correction in wave 4 tends to have a more complex structure like Double Three or Triangle (see the chart below). Unfortunately, in real life there are plenty of cases when waves 2 and 4 may alternate in shape but cab be both deep or shallow. That is why this phenomenon is called “guidance” instead of “rule”.
Case Studies:
The best way to understand how this pattern works is to study collection of charts with real life examples.
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- Introduction to Section 6 “Corrective Waves”.
- Simple Zig-Zag.
- Correction shaped as a Simple Zig-Zag.
- Regular Flat.
- How to trade a corrective waves shaped as a Regular Flat.
- Running Flat.
- Expanded Flat.
- Correction Shaped as a Triangle.
- How to Trade Triangles.
- Triangle: Key Takeaways.
- Complex Corrective Pattern: Double Three.
- Wave B is the least predictable beast.
- Bonus.Wave B explained.
- Overview of corrective structures: corrections “through time” vs corrections “throw price”.
- Guidance on Alternation Between Corrective Waves.