medium · Elliott Wave Theory
A stock analyst observes three price pullbacks. The first is 10 points over 4 days. The second is 12 points over 5 days. The third is 35 points over 25 days.
Based on the 'Proportionality Guideline', what should the analyst suspect about the third pullback?
- It is a truncated fifth wave beginning.
- It is likely a correction of a higher degree, and the wave labels must be revised.
- It is a classic zigzag that confirms the trend.
- It is the Wave 4 completion of the current minor impulse.
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