Elliott Wave Essentials ยท 45 min ยท Advanced
Advanced Elliott Wave Structures
Extensions, Diagonals, Double and Triple Corrections, and Truncation.
Advanced Elliott Wave Structures
Real markets are often more complex than the basic pattern. Here you'll learn the most important advanced structures:
1. Extensions (Elongations)
An extension is an extremely elongated impulse wave that itself consists of 5 smaller waves.
Where do extensions occur?
๐ Mostly in Wave 3 (most common)
๐ฐ Sometimes in Wave 5 (especially in commodities)
๐ Rarely in Wave 1
โ ๏ธ RULE: Only ONE impulse wave per sequence can extend!
Trading Significance:
- Extensions show extreme trend strength
- Wave 3 extension = perfect trend trade
- Wave 5 extension = Caution, often blow-off top
2. Diagonals (Wedge Formations)
Diagonals are 5-wave patterns where the waves overlap (exception to Rule 3!).
Leading Diagonal (Wave 1 or A)
Structure: 5-3-5-3-5
๐ Occurs at the beginning of trends
๐ Shows uncertainty
๐ After leading diagonal, often strong wave 3 follows
Ending Diagonal (Wave 5 or C)
Structure: 3-3-3-3-3
โ ๏ธ Appears at the end of trends
โ ๏ธ Shows exhaustion
โ ๏ธ After ending diagonal, usually sharp reversal occurs
๐ก IMPORTANT: In diagonals, waves 1 and 4 are allowed to overlap - this is the only exception!
3. Double and Triple Corrections (W-X-Y-Z)
Sometimes one ABC correction is not enough. The market then makes a combination:
Double Correction (W-X-Y)
W = First correction (ZigZag, Flat, three-part)
X = Connecting wave (can consist of all correction types)
Y = Second correction (usually different type than W, three-part, rarely triangle)
Triple Correction (W-X-Y-X-Z)
๐น Three correction patterns combined
๐น Very rare
๐น Shows extreme uncertainty
๐น Usually very time consuming
4. Truncation (Cut-off Wave 5)
Sometimes wave 5 does not reach the high of wave 3:
โ ๏ธ Shows extreme weakness
โ ๏ธ Often before sharp reversals
โ ๏ธ All other rules must still apply
โ ๏ธ Confirmation by other indicators necessary
How do I master complex structures?
โ Zoom out: Look at larger time units
โ Patience: Wait for clarity, not every pattern is immediately recognizable
โ Alternatives: Always keep 2-3 scenarios in mind
โ Confirmation: Use volume, RSI, MACD for confirmation
โ Rules first: If the 3 golden rules are violated, it's not a valid pattern
Reversibility of Structures
All presented wave structures can appear reversed in a different market phase. An impulsive movement in an uptrend can, for example, appear mirrored in a downtrend.
The decisive factor is always the direction of the superior trend โ the patterns remain the same, only their orientation changes.
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