ELLIOT WAVE IMPULSE WAVE GUIDELINES 1. Alternation - The corrective wave 2 is sharp and therefore we expect wave 4 to be sideways. 2. Channelling - We have put the target of wave 5 on the upper trendline of a channel. 3. Ratio Analysis. In a normal impulse wave, wave 4 is usually at fib 0.382 of the whole 5 wave pattern.
Guidelines 2 and 3 are used to get the price target of wave 5