medium · Elliott Wave Theory
An analyst observes a rally from $100 to $150, a pullback to $135, and a second rally to $175. During the rally to $175, volume is 30% lower than during the first rally, and the RSI shows negative divergence.
How should this structure likely be labeled?
- A Zigzag correction (A-B-C)
- A standard five-wave impulse where Wave 5 is truncated
- A leading diagonal in the Wave 1 position
- The start of an extended Wave 3 impulse
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