- EW Impulses + Equality - Alternation within Correction - Depth of Correction Wave - Fibs Extension + Retracement
EW Impulse Guidelines ; (1) Wave 2 cannot retrace the entire wave 1. (2) Wave 3 can't be the shortest among waves 1, 3 and 5. (3) Wave 4 can't overlap with the price territory of wave 1. (4) Wave 5 needs to end with bearish divergence
Fibonacci Ratio Relationship • Wave 2 is 50%, 38.2%, 23.6%, or 14.6% of wave 1 (Fibs Retracement) • Wave 3 is 161.8%, 200%, 261.8%, or 323.6% of wave 1-2 (Fibs Extension) • Wave 4 is 14.6%, 23.6%, or 38.2% of wave 3 but no more than 50% (Fibs Retracement) • There are three different ways to measure wave 5. First, wave 5 is inverse 123.6 – 161.8% retracement of wave 4. Second, wave 5 is equal to wave 1. Third, wave 5 is 61.8% of wave 1-3
Please keep in mind that they are not rules, they may not work out every time.
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