Structure first. Understand the two types of motive waves — impulse and diagonal — and the rules that define them.
Elliott Wave theory holds that markets move in repeating fractal patterns driven by crowd psychology. Every complete cycle has two phases: a 5-wave motive phase in the direction of the larger trend, followed by a 3-wave corrective phase against it.
A motive wave moves in the direction of the one-larger-degree trend. Two types: the impulse (strict 5-wave, no wave 1/4 overlap) and the diagonal (wedge-shaped, overlap permitted). Click the tabs to explore each.
An impulse is the most common motive wave — five sub-waves where 1, 3, 5 move with the trend and 2, 4 correct against it. Three hard rules govern validity. Click any turning point or wave segment for details.
Click any turning point (0–5) or wave segment to learn about that wave.
A diagonal is the second type of motive wave — wedge-shaped with overlapping sub-waves, still moving in the trend direction. Unlike an impulse, wave 4 overlapping wave 1 is permitted (ending diagonal) or expected (leading diagonal).
Ending diagonal — wave 5 or wave C
Sub-wave structure: 3-3-3-3-3. Every wave including motive waves (1, 3, 5) is a 3-wave zigzag. Wave 4 must overlap wave 1's territory.
Click any turning point (0–5) to learn about that wave in the ending diagonal.
Leading diagonal — wave 1 or wave A
Sub-wave structure: 5-3-5-3-5. Motive waves (1, 3, 5) are full 5-wave impulses. Corrective waves (2, 4) are 3-wave structures. Wave 4 still overlaps wave 1.
Click any turning point (0–5) to learn about that wave in the leading diagonal.
The key structural difference
Ending diagonal motive waves (1,3,5) are each 3-wave zigzags — they look corrective internally. Leading diagonal motive waves are each 5-wave impulses — they look impulsive internally. This is visible in the sub-wave texture above.
After completion
Ending: sharp reversal retracing to the diagonal's origin — exhaustion signal. Leading: deep wave 2 correction (~78.6%) then the real wave 3 impulse begins — trend initiation signal.
Rules are inviolable — one violation means the count is wrong. Guidelines hold most of the time but allow contextual exceptions.
Impulse — hard rules
✕Wave 2 never retraces 100%+ of wave 1. If price reaches or exceeds wave 1's origin, it is not an impulse — re-label.
✕Wave 3 is never the shortest of waves 1, 3, and 5 in price range. It may be shortest in time, never in price.
✕Wave 4 never enters wave 1's price territory. Exception: diagonal triangles only.
Impulse — guidelines
~Wave 2 retraces 50–61.8% of wave 1. Shallow (23.6–38.2%) in strong trends; deep (78.6%) near invalidation.
~Alternation: if wave 2 is sharp (zigzag), wave 4 tends to be sideways (flat or triangle), and vice versa.
~Wave 3 extends to 1.618× wave 1 from wave 2's end. Extended thirds reach 2.618× or 4.236×.
~Wave 4 retraces 23.6–38.2% of wave 3 and often finds support at the prior wave 4 of one lesser degree.
~Wave 5 equals wave 1 in length, or = 0.618× origin-to-end-of-wave-3. Oscillator divergence often signals completion.
Diagonal — hard rules
✕Both boundary lines must converge into a wedge. Diverging lines invalidate the count.
✕Wave 3 is never the shortest sub-wave in either diagonal type.
✕In an ending diagonal, wave 4 must overlap wave 1's territory. No overlap = not an ending diagonal.
✕Ending diagonal is always 3-3-3-3-3. Leading diagonal motive waves are 5-wave impulses (5-3-5-3-5).
Motive vs impulse — terminology
→Motive wave is the parent category — any wave moving with the one-larger-degree trend. Two types: impulse and diagonal.
→Impulse is a specific motive wave — strict 5-wave structure, no wave 1/4 overlap permitted.
→All impulses are motive waves. Not all motive waves are impulses. Diagonals are also motive waves.
