This article has been translated from English to Gen Z Slang.
So, listen up fam, if you're gonna vibe with the Elliott Wave Theory in your trading journey, it's all about getting those waves ID'd right like a pro.
Nailing that wave spotting skills means you’ll know whether you gotta clap back on the long or short side of the market, no cap.
Okay peeps, there are THREE must-follow, "can't-even-think-about-breaking" rules for wave labeling.
So, before you yeet yourself into using the Elliott Wave Theory, peep the rules below first.
Messing up the wave labeling can totally wreck your account, and that ain't it chief.
3 Cardinal Rules of the Elliott Wave Theory
Rule Number #1: Wave 3 can NEVER be the shortest impulse wave, no exceptions!
Rule Number #2: Wave 2 is NEVER allowed to go past where Wave 1 started, like ever.
Rule Number #3: Wave 4 can't be playing in the same zone as Wave 1, like a total clash.
Elliott Wave Trading Guidelines
And hey, then we got some guidelines to help you slap waves on there like a star.
These aren't as hardcore as the big three rules, so ya know, you can bend 'em a bit. Catch these:
Sometimes, Wave 5 pulls a sneaky on ya and doesn’t get past Wave 3's finish line, that's what ya call a truncation.
Wave 5 is usually out here, flexin' past or "breakin' through" the trend line linked up from Wave 3 parallel to the one connecting the starter points of Waves 3 and 5.
Wave 3 loves to be that extra-long, pointy one, giving out major extension goals.
Waves 2 and 4 low-key like to bounce around those Fibonacci retracement levels like they own it.
