Technical Analysis Elliott Waves Part 6

Triangles

A triangle correction pattern has the form of a triangle.

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Figure 7.24: Different types of triangle correction patterns.

Figure 7.24 shows the different types of triangle correction patterns.

The triangle is a correction pattern consisting of five waves identified with the letters ABCDE. The triangle is drawn between the points AC and BD. It can be a symmetrical triangle or a rising or falling triangle. An inverted widening triangle is a rather rare.

Triangles will not be found in any type 2 wave, in a flat correction B wave, or in double or triple flat correction waves W, X, and X².
The inverted widening triangle is never seen in double or triple zigzag waves X or X².
All waves within a triangle pattern are correction waves.

Wave E will, in some cases, penetrate the AC line.

In the normal triangles we note three types: symmetrical, rising, or falling triangles.

The inverted widening triangle only exists in a symmetrical version.

Rules and Guidelines for the Triangle

• Wave A is a simple, double, or triple zigzag pattern, or a flat correction.
• Wave B is a simple, double, or triple zigzag pattern.
• Waves C and D can be any correction pattern, except a triangle.
• Waves ABC and D remain within or close to the triangle channel.
• The triangle is closed after wave E.
• The triangle lines converge; they cannot be parallel lines.
• One of the sides of the triangle can be a horizontal line.
• Wave E is a simple, double, or triple zigzag pattern, or a triangle.
• Wave E has a smaller price move than wave D, but it moves more than 20% of D.
• Either wave A or wave B has the biggest price move.
• Wave E ends in the range of wave A.
• Wave E ends within or close to the BD line.

Rules and Guidelines for the Inverted Widening Triangle

• The five waves have a simple, double, or triple zigzag pattern.
• Wave B is smaller than wave C, but a minimum 40% of wave C
• Waves ABCD move within or close to the lines AC and BD.
• Wave C is smaller than wave D, but a minimum 40% of wave D.
• Wave A moves within the line AC.
• Wave A starts after the starting point of the inverted triangle.
• The channel lines of the inverted triangle diverge; they cannot be parallel lines.
• None of the channel lines can move horizontally.
• Wave E is bigger than wave D, but wave D is a minimum 40% of wave E.
• Either wave A or wave B has the smallest price move.
• Wave E ends in the range of wave A.
• Wave E ends within or close to the BD line.