ZigZag Rules

Question 1

ZigZag Rules

What is a ZigZag in Elliott Wave Theory?

Answer 1

A ZigZag is a three-wave structure labeled A-B-C, generally moving counter to the larger trend. It is the most common three-wave Elliott pattern and is corrective in nature.

Question 2

ZigZag Rules

What must Wave A be?

Answer 2

Wave A must be an Impulse or a Leading Diagonal.

Question 3

ZigZag Rules

What must Wave B be?

Answer 3

Wave B is any type of corrective pattern.

Question 4

ZigZag Rules

How does Wave B compare to Wave A by price?

Answer 4

Wave B must be shorter than Wave A by price (all internal points are considered).

Question 5

ZigZag Rules

How much of Wave A must Wave B retrace by price?

Answer 5

Wave B must be at least 20% of Wave A by price.

Question 6

ZigZag Rules

How long can Wave B take compared to Wave A?

Answer 6

Although there is no minimum time constraint for Wave B, it must not exceed 10 times the time taken by Wave A.

Question 7

ZigZag Rules

What must Wave C be?

Answer 7

Wave C must be an Impulse or an Ending Diagonal.

Question 8

ZigZag Rules

What is the rule for Wave C if Wave A is a Leading Diagonal?

Answer 8

If WA is a LD, WC must be an IMP

Question 9

ZigZag Rules

How does Wave C compare to Wave B by price?

Answer 9

Wave C must be longer than 90% of Wave B by price.

Question 10

ZigZag Rules

How does Wave C compare to Wave B by price?

Answer 10

Wave C must be less than 5 times Wave B by price.

Question 11

ZigZag Rules

What is the rule about failures in Wave 5 of A and Wave 5 of C?

Answer 11

It is not allowable to have both Wave 5 of A a failure (Wave 5 is shorter than Wave 4) and Wave 5 of C a failure.

Question 12

ZigZag Rules

How does Wave C compare to Waves A and B in price or time?

Answer 12

Wave C must be no more than 10 times either Wave A or Wave B in price or time.