In this webinar recorded earlier today, we assessed one of the cornerstone patterns of Elliott Wave Theory, the impulse.
There are three main rules associated with impulse waves:
- Wave 2 cannot retrace 100% or more of wave 1.
- Wave 3 cannot be the shortest wave relative to waves 1, 3, 5.
- Wave 4 cannot terminate in the territory of wave 1.
We also looked at an idealized view and incorrect labeling of an impulse. It is critically important to understand that as a budding Elliott Wave technician, if the rules above are ‘broken’ then that implies the wave labeling is incorrect and to look for a better way to count those waves.
Lastly, we finished up with some examples on how you trade using this knowledge. We discussed which waves of the impulse are the ones to focus on.
See how Elliott Wave Theory is applied in the current environment in the main markets. Join Jeremy in the US Opening Bell webinar on Mondays here.
If you cannot make the live webinars, but wish to learn more about Elliott Wave theory, grab our beginning and advanced Elliott Wave guides here.
Part 1 - Elliott Wave Impulses
Part 2 - Elliott Wave Zigzags
Part 3 - Elliott Wave Flat Patterns
Part 4 - Elliott Wave Triangles
Part 5 - Elliott Wave Complex Corrections
Part 6 - Elliott Wave Diagonals
Part 7 - Starting your Elliott Wave Counting
---Written by Jeremy Wagner, Head Trading Instructor & Certified Elliott Wave Analyst
Follow me on Twitter at @JWagnerFXTrader .
See Jeremy’s recent articles at his Bio Page.