Corrective Waves in Elliott Wave Theory: ABC Patterns Explained

In Elliott Wave Theory, after a 5-wave impulsive move, markets typically enter a 3-wave corrective phase. These corrections move against the prevailing trend and are labeled A, B, and C instead of numbers.

🔄 What Is a Corrective Wave?

Corrective waves are countertrend moves that follow the dominant 5-wave trend. Whether you’re in a bull or bear market, these 3-wave patterns help identify when a retracement or reversal is likely to occur.

Corrective waves consist of:

• Wave A: Initial countertrend move.
• Wave B: Partial retracement.
• Wave C: Continuation of the countertrend.

📊 Example:

• In an uptrend, the ABC correction would look like a pullback.
• In a downtrend, it’s simply flipped in the opposite direction.

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🧩 Types of Corrective Wave Patterns

Elliott identified 21 variations of ABC corrective waves, but don’t worry — they all stem from just three core formations:

1️⃣ Zig-Zag Correction

A Zig-Zag is a steep correction that moves sharply against the main trend.

• Structure: 5-3-5
• Wave B is usually the shortest.
• Can repeat as double or triple zig-zags.
• Found in both uptrends and downtrends.

📝 Tip: Each wave (A and C) can be broken down into smaller 5-wave structures.

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2️⃣ Flat Correction

A Flat is a sideways correction where all waves are typically similar in length.

• Structure: 3-3-5
• Wave B often retraces all or more of Wave A.
• Wave C ends near the start of Wave A.
• Common in consolidation phases.

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3️⃣ Triangle Correction

Triangles are formed by 5 waves (A-B-C-D-E) that move sideways, bounded by converging or diverging trendlines.

• Types:
  • Symmetrical
  • Ascending
  • Descending
  • Expanding
• Usually found in Wave 4 or B of a larger pattern.

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✅ Key Takeaways

• Corrective waves counter the main trend and help identify potential entry/exit points.
• The three most common corrective formations are: Zig-Zags, Flats, and Triangles.
• These patterns are universal — applicable to forex, stocks, crypto, or commodities.

📌 Mastering these patterns gives traders an edge in anticipating market reversals and trend continuations.

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