1. Flat wave model
The Flat Wave Pattern (FL) is a common form of corrective wave, consisting of three waves marked as A-B-C. It differs from Zigzag (ZZ) patterns in that it tends to move in a choppy manner rather than strongly up or down, hence the name “Flat.” This pattern tends to be a corrective wave of the preceding trend mildly and can often evolve into a popular flag pattern when it appears. At times, it can resemble a simple channel where prices tend to move predominantly sideways within the channel and exhibit fewer clear signs of price increase.
In an Impulse Wave, the Flat pattern is typically found in the fourth wave (especially if the second wave was a zigzag, the fourth wave can often be a flat), which can create the ‘A’ or ‘B’ waves of the corrective pattern, but you won’t find them in the ‘C’ wave of the corrective pattern. Additionally, the Flat pattern can appear in the B wave of a zigzag pattern or as a component wave of a Double Three or Triple Three Combination. However, you won’t find the Flat pattern within a triangular pattern. Triangular patterns are constructed from zigzag patterns or other triangle patterns.
Furthermore, the Flat pattern (FL) typically follows a 3-3-5 or 3-3-7 wave structure. In contrast, Zigzag patterns move quickly and strongly either up or down, following a 5-3-5 wave structure.
2. Principles of Flat wave model
- Wave A can follow any corrective pattern.
- Wave B can follow any corrective pattern except for Contracting Triangle (CT) and Expanding Triangle (ET).
- Wave B must retrace at least 50% of Wave A’s price range (according to Fibonacci Retracement) and must be shorter than twice the length of Wave A (0.5A ≤ B ≤ 2A).
- Wave C can only be an Impulse (IM) pattern, an Ending Diagonal (ED) pattern, or a Double Zigzag (DZ) pattern. If Wave C follows a Double Zigzag (DZ) pattern with an expanded Wave X, the internal wave structure of the Flat (FL) pattern is 3-3-3. However, if Wave X doesn’t expand, the internal wave structure of the Flat (FL) pattern is 3-3-7.
- Wave C cannot be longer than 3 times the length of Wave A (C ≤ 3A).
- Wave C must share a price region with Wave A.
In essence, there are four types of Flat corrective patterns: Regular Flat, Expanded Flat, Running Flat, and Elongated Flat. The name of the pattern you identify is not as important as its significance. Each of the mentioned Flat types implies a consolidation before the continuation of the preceding trend, occurring before the formation of the Flat pattern.
3. Variations of Flat wave model
a. Flat Expanded/Irregular model
The Expanded Flat wave pattern is a particularly common type of Flat pattern. In this pattern, Wave B extends beyond the end of the previous main wave (in other words, it exceeds the starting point of Wave A).
The strength of Wave B indicates the market’s desire to continue along the main trend. If Wave C is much longer than Wave A, that strength will diminish.
b. Running Flat model
The Running Flat pattern is similar to the Expanded Flat pattern, where Wave B extends beyond the starting point of Wave A, but the end point of Wave C does not exceed the end point of Wave A. This demonstrates the strength of the main trend.
c. Elongated Flat model
In the Elongated Flat pattern, Wave C is significantly longer than Wave A, and it can even be as long as 2.618 times the length of Wave A. In this wave pattern, Wave C often takes the form of an extended fifth wave of the main trend.
You have just read: Corrective wave - Flat In the next article, I will share about: Corrective wave - Triangle For reviewing the last part: Corrective Wave - Zigzag
 is a common form of corrective wave, consisting of three waves marked as A - B - C){kind=link}