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HomeInvestmentTechnical AnalysisPart 8: Corrective Wave - Combination

Part 8: Corrective Wave – Combination

In previous articles, we learned that within the Elliott Wave Principle, there are three major types of corrective patterns: Zigzag, Flat, and Triangles. These three patterns are commonly encountered in the market, occurring in waves 2, 4, or B. For instance, if wave 2 is a Zigzag, wave 4 might be a Triangle. However, in reality, the market is not always that straightforward. Especially when prolonged price corrections occur, the patterns are no longer as simple. Investors will need to delve into new concepts, and in this article, I will introduce one of them— the "Corrective Combination." This term refers to a more complex type of corrective pattern that arises when market corrections extend over extended periods. Navigating these complex patterns can pose challenges, prompting investors to continue exploring new concepts. In this article, I'll introduce you to one of these concepts: the "Corrective Combination," which refers to the combination of multiple corrective patterns within a single wave sequence.

1. Corrective WaveCombination

The Corrective Combination involves combining 2 or 3 different corrective wave patterns together. These patterns are marked as WXY (Double Three) and WXYXZ (Triple Three) if they are more complex. The sequence starts with a Zigzag (wave W), followed by a wave X, and then a Flat pattern (wave Y), and so on.

The Double Three (D3) pattern is more common, while the Triple Three (T3) pattern is less frequently encountered.

All corrective patterns can be combined to form larger corrective structures. The rules of corrective waves are applied to the mentioned patterns as well. The Triangle pattern often appears at the end of a Combination pattern.

In general, combined wave patterns are mostly found in waves 4, B, and X. They are less likely to appear in wave A and rarely in wave 2.

the "Corrective Combination," which refers to the combination of multiple corrective patterns within a single wave sequence
Corrective Wave – Combination

Principles

  • Wave (W) can follow any corrective wave pattern except for Triangle patterns (Contracting, Expanding) and Double or Triple patterns.
  • Wave (X) can follow any corrective wave pattern except for Double or Triple patterns. Typically, wave (X) takes the form of a Zigzag (ZZ). The minimum retracement level of wave (X) is 50% of wave (W); the maximum retracement level of wave (X) is 400% of wave (W).
  • Wave (Y) can follow any corrective pattern except for Double or Triple patterns. Wave (Y) must have a higher price range than wave (X), except when wave (Y) is a Triangle pattern (Contracting, Expanding).
  • Wave (Z) can follow any corrective pattern except for Double or Triple patterns. However, wave (Z) cannot be a Zigzag (ZZ) if wave (Y) is a Zigzag (ZZ). Wave (Z) must have a higher price range than the second wave (X).

Double Three Wave Model

The Double Three (D3) pattern is formed by combining two corrective wave patterns, with the condition that they are not both Zigzag (ZZ) patterns, connected by a short corrective wave pattern called wave (X).

The Double Three (D3) pattern is represented by waves (W)-(X)-(Y), where waves (W) and (Y) are not both Zigzag (ZZ) patterns.

the "Corrective Combination," which refers to the combination of multiple corrective patterns within a single wave sequence
DOUBLE THREE WAVE MODEL

Details of Double Three wave structure

Wave (W) is a Zigzag (ZZ), while wave (Y) takes the form of either Triangle patterns (Contracting, Expanding) or Flat patterns (FL).

the "Corrective Combination," which refers to the combination of multiple corrective patterns within a single wave sequence
Details of Double Three wave structure

Wave (W) takes the form of Flat patterns (FL), while wave (Y) can be in the form of Flat patterns (FL), Zigzag (ZZ), or Triangle patterns (Contracting, Expanding).

the "Corrective Combination," which refers to the combination of multiple corrective patterns within a single wave sequence
Details of Double Three wave structure

Triple Three Wave model

The Triple Three (T3) pattern is formed by combining three corrective wave patterns, with the condition that they are not all Zigzag (ZZ) patterns, connected by two short corrective wave patterns called waves (X).

The Triple Three (T3) pattern is represented by waves (W)-(X)-(Y)-(X)-(Z), where waves (W), (Y), and (Z) are not all Zigzag (ZZ) patterns.

the "Corrective Combination," which refers to the combination of multiple corrective patterns within a single wave sequence
Triple Three Wave model

Details of Triple Three Wave structure

Wave (W) takes the form of Zigzag (ZZ) patterns, while wave (Y) is in the form of Flat patterns (FL), and wave (Z) is in the form of Triangle patterns (Contracting, Expanding):

the "Corrective Combination," which refers to the combination of multiple corrective patterns within a single wave sequence
Details of Triple Three Wave structure

Wave (W) takes the form of Flat patterns (FL), while wave (Y) and wave (Z) can be in the form of Flat patterns (FL), Zigzag (ZZ), or Triangle patterns (Contracting, Expanding). However, wave (Z) cannot be a Zigzag (ZZ) if wave (Y) is already a Zigzag (ZZ).

the "Corrective Combination," which refers to the combination of multiple corrective patterns within a single wave sequence
Details of Triple Three Wave structure
You just read about Corrective Wave – Combination

In the next article, I will show you about The relationship of Fibonacci in waves

For reviewing the last part: Part 7: Corrective Wave-Triangle
Pham Thanh Bien
Pham Thanh Bienhttps://ebila.com
Mr. Pham Thanh Bien - Chairman of Vinmoc's Board of Directors, a self-made millionaire, with practical investment experience in the financial market since 2005. He is the person who shares and inspires thousands of investors in Vietnam.
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