Let’s take this labelling as a case study.
The red ABC pattern is a 3-wave pattern. It’s a correction.
Corrections happen in waves 2 and 4.
This entire correction happened in wave 2. After wave 2 comes wave 3. That sharp upward spike on the right is wave 3. Wave 3 will help price to resume its upward trend.
Now, inside that ABC correction is another correction. It’s a 5-wave pattern called a triangle. A triangle is a wave that is always before the last impulse in a given cycle.
In this case it happened as wave B which was before the last impulse (wave C). It can also happen as wave 4 which is before the last impulse called wave 5.
The red ABC pattern is a 3-wave pattern. It’s a correction.
Corrections happen in waves 2 and 4.
This entire correction happened in wave 2. After wave 2 comes wave 3. That sharp upward spike on the right is wave 3. Wave 3 will help price to resume its upward trend.
Now, inside that ABC correction is another correction. It’s a 5-wave pattern called a triangle. A triangle is a wave that is always before the last impulse in a given cycle.
In this case it happened as wave B which was before the last impulse (wave C). It can also happen as wave 4 which is before the last impulse called wave 5.