A Method to Predict Range Exit with Flat Pattern — Elliott Wave
Characteristics of Normal Flat Pattern
・Wave B reaches about the same price as the starting point of Wave A, and Wave C drops below Wave A.
Irregular Flat Pattern
・Wave B reaches about the same price as the top of Wave A, but Wave C does not fall as much as Wave A.
This is hard to understand.Basically, for flat corrections, I think waiting and watching is best.Be careful of chart pattern breakdowns like Double Top (Double Bottom).When this chart pattern breakdown appears, entering with a bullish bias could also be valid.
Irregular Top
・Wave B exceeds the starting point of Wave A and Wave C drops below Wave A.
As I mentioned at first, you shouldn’t decide this in advance; trading based on it without knowing may lead to failure.
Flat PatternA little more
A－B－CThe sequence does not change.Zigzag and Flat are the samein meaning.
The big difference with the Zigzag pattern is thatAWave becomes three waves.
The second characteristic isBWave adjustment isAthe range of Wave61.8% or more.
In Zigzag,BWave retracement was61.8% at maximum, but in Flat pattern61.8% is the minimumoften retraces more than 100%.WaveCmay be longer or shorter than Wave A.
In Flat Pattern, Wave B retracement and Wave C amplitude are harder to gauge, so waiting is safer.
In contrast, Zigzag tends to move more predictably, making it easier to target.
Irregular Flat Pattern Running Flat
When a running pattern appears, there is considerable market momentum.
If the price rises rapidly on shallow pullbacks, this pattern often occurs.
BWave exceedsAtop of Wave by a wide marginCWave does not fall much.
Tends to appear when the market has momentum. It moves while adjusting, hence Running Flat
When trading during an Adjustment WaveAIf Wave time is longer thanBWave time, the likelihood of a Zigzag pattern is high.
AIf Wave time is longer thanBWave time is shorter, it is more likely to become a Running Collection.
AIf the time taken for the wave is longer,Bthe wave turns faster at an early stage; in this case Wave B is still considered to be in progress. (Do not make a definitive conclusion)
Entry point isBWhen WaveAdrops below its low, enter. If you can enter here, you can target part of WaveBand WaveCto achieve a large price range.
Expanding Flat
BWaves areAlonger than WaveCand WaveBis longer than Wave.
A＜B＜C
At this point, I think this requires a considerable degree of study to understand. Probably almost no one can count all the adjustments.
So why??
Because writing out adjustment waves this long is useful for forming a plan you can remember.
As you actually look at charts and practice, you might think, “Huh, Zigzag pattern maybe?” or “Hmm?”
You begin to understand that it could be a Flat pattern. This expands your strategic options greatly, so I recommend memorizing it.
There is no need to force-fit adjustment waves; instead, predict the end of the move and target the main trend to reduce risk.
Summary of Characteristics and Rules of Adjustment Waves
・AWave is composed of 3 or 5 waves
・If Wave A is 5 waves, it tends to be a Zigzag with a deep bottom value.
・BWave is always a 3-wave structure
・When Wave A is a 3-wave structure in a flat pattern, there are times when it updates a high.
・CTarget levels for the wave are first the point where A=C is aimed. Thentimes or multiples, etc., shifted. The bottom of the most recent 4-wave of the 5-wave pattern also functions as a support line.
・Alternation
