5 Types of Elliott Wave Patterns to understand Market Behaviour (🧵)

Before we dig in, what exactly is the Elliott Wave Theory?

The Theory suggests that the #stock priced move continously up & down in the same pattern known as waves👇

The underlying theory behind these waves is #Trader Psychology. The Theory suggests that these patterns are recurring in nature👇

1. Motive Waves: These move in the direction of the main #trend and consists of 5 waves that are labeled as Wave 1..2..3..and so on👇

Wave 1,2 and 3 move in the main direction, whereas Wave 2 and 4 move in the opposite direction. There are 2 types of Motive Waves: Impulse and Diagonal Waves

2. Corrective Waves: These are known to counter the main trend. They are more complex and time-consuming than motive Waves👇