Not much happening in the markets today, so I decided to do another episode of my tutorial series.

Today I am going to talk about the differences between types of corrections. Standard correction types like ABC, a,b,c,d,e and complex corrections, which range from a double ZigZag correction (WXY), to a triple ZigZag correction (WXYX2Z), to combinations of all types possible.

There are 36 types of corrections that can occur, but you don't need to know all of them.

I will show you a simple way to handle complex corrections. Here it is:

You just switch to a higher timeframe (in this case the 30min/1hour chart) and wait for bullish candlesticks or a new impulse wave. It is that simple.

It is important to understand that once you see a complex correction, you will never know for sure when it is finished, until you see the next impulse move. They have a tendency to go on and on and on.

There are so many combinations possible, that you just have to be careful to not get in before the expected impulse wave has started. You can then use a tight stop with usually a great risk reward ratio.

You might get stopped out a few times with small losses, but the following impulse is usually worth the risk.

With time, you will know what to look for before entering a trade. You can of course combine this method with pattern analysis. So if you see an ascending right triangle, or iSKS for example, you will feel more confident to enter a trade.

Note that some impulses start slow, then accelerate quickly.

If you want to check out Ep.1 here is the link again:

https://steemit.com/bch/@ew-and-patterns/educational-learning-to-count-elliott-waves-ep-1-standard-corrections-bch-style

If you think this to be useful information:


Feel free to use and share my charts, but please mention me, @ew-and-patterns as the author. Otherwise it is considered plagiarism and I will flag you and advise my friends to do the same.

DISCLAIMER: I provide trading ideas using EW and Pattern analysis. The material in this post does not constitute any trading advice whatsoever. This is just the way I see the charts and what my trading ideas are. The author of this post is holding positions in this market at the time of this post.
If you make any trades after reading this post it is completely in your responsibility. I am not responsible for any of your losses. By reading this post you acknowledge and accept that.

Tell me what you think...

Have a nice day :-)