medium · Elliott Wave Theory alternation
A correction targets the price zone of the 'prior fourth wave of one lesser degree'.
What does this mean in practice for an analyst identifying a Primary degree Wave (4) correction?
- It must retrace exactly 38.2% of the entire impulse move from Wave (1) up to Wave (3).
- It should terminate at precisely the same price level as the low of the Primary degree Wave (2).
- It should terminate near the price range of the Minor degree Wave 4 inside the Primary Wave (3).
- It will most likely overlap with the exact price peak reached at the very top of Primary degree Wave (1).
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