Based on the above reasons, understanding the characteristics of each wave is helpful to the work of Apollo number.
The first wave of characters:
The characteristics of the first wave are introduced. For the convenience of explanation, the upward trend of the first wave is taken as the basis for the introduction. In fact, the first wave can also go down. Facing the downward push, the following concepts can be interpreted in reverse. The beginning of the first wave means that the adjustment of the market situation has ended. So the first wave is actually a sign of market changes. The first wave can be divided into five groups of waves with lower levels, such as those shown in the hourly chart. Generally speaking, when there are three waves in the market and then the first wave appears, it is enough to prove that the price will turn around and rise after the market is adjusted downwards. When the first wave starts to run, it may be difficult to identify at first, but once the first wave has finished the journey, it will constitute a reliable signal, and other push waves will appear one after another. A second wave appears next, but its adjustment amplitude should not be greater than the length of the first wave. If the third wave belongs to spread wave, the fifth wave often has the same length as the first wave. So the first wave can be used to predict the rising target of the fifth wave peaking. About half of the first wave is a part of the bottom form. The second wave after this first wave has a large adjustment range, but in any case, the recovery range cannot be greater than 100% of the first wave.
The second wave tests judgment: the end of the second wave usually appears in the following three areas.
(1) The first wave of 38.2% or 6 1.8% may be adjusted.
(2) Most of them run in the form of three waves. If the walking waveform can be judged as flat or zigzag, then the length of C wave is likely to be the same as that of A wave.
(3) The second wave in the first wave may also give back to the fourth wave.
In the analysis system of other dynamic indicators, these dynamic indicators should be oversold when the second wave runs to the end.
Dynamic index analysis system includes: strength index, randomness, dynamic index and so on.
The appearance of the second wave often tests the judgment ability of chart analysts, and some of the second waves have a large adjustment range. Sometimes people get confused and wonder if the new push wave has really started.
It can be said that the emergence of the second wave is Smith's posturing. Putting fear in investors' minds creates a momentum, giving people a false feeling that the starting point of the first wave, that is, the last low point, will soon fall.
In fact, as long as the low point of the second wave is not lower than the starting point of the first wave, it can still be accepted as the second wave. In the futures market, there are countless examples that the bottom of the second wave is only three or five price points away from the starting point of the first wave. In the market chart, if the first wave is short, the second wave will often be adjusted to be close to 100% of the first wave.
The third wave is the most explosive: in pushing waves, the third wave is the most powerful and explosive wave. Generally speaking, the rising range mostly appears in the third wave of the market. Slotting is a common phenomenon in the third wave, which can help to confirm the existence of the third wave.
The third wave can be subdivided into five lower-level waves.
According to the two inviolable rules of wave counting, the third wave can never be the shortest push wave, in other words, the third wave must be longer than the first wave or the fifth wave. The actual situation shows that the third wave is usually the longest wave in the push wave, and the third wave can be as long as the first wave. In this case, The 5th Wave may become a spread wave. The third wave is often faster than the first wavelength. A very common magic number ratio is 1.6 18, and the third wave is equal to 1.6 18 times of the first wave.
After confirming that the third wave has started to run, any transaction should follow suit and choose to buy at a low level.
The third wave is the most explosive wave, and the rising range is not limited in advance. The third wave can be 1.6 18 times of the first wave, or it can climb 2.6 18 times or other magic numbers. Subjectively going against the trend is undoubtedly asking for it. You should know that any technical analysis focuses on following the trend, and the game of touching the top is definitely not worth encouraging. Trading volume usually increases sharply in the third wave, which becomes another reliable evidence.
The fourth wave is unpredictable:
There are four possibilities for the end of the fourth wave:
(1) Adjust the third wave by 38.2%;
(2) Spit back to the lower layer within the range of the fourth wave, that is, the fourth wave of the third wave;
(3) If it appears flat or zigzag, the lengths of C wave and A wave are the same;
(4) It may be the same length as the second wave.
Another rule of the wave counting rule stipulates that the bottom of the fourth wave cannot be lower than the top of the first wave. The only exception is the diagonal triangle runtime of the fifth wave.
The fourth wave often runs in a triangle, including four triangles: the rising triangle, the falling triangle, the symmetrical triangle and the trumpet triangle. The relationship between the second wave and the fourth wave is that they will appear in different forms. In short, if the second wave is a gentle adjustment wave, then the fourth wave will run in a triangle or zigzag shape. On the other hand, assuming that the zigzag of the second wave adjusts the motion of the wave, the fourth wave may appear as a plane or triangle. At the end of the fourth wave, the strength indicator is generally quarterly sales. Generally speaking, the fourth wave often appears in a more complicated form. When a group of five waves rises to the end of the market, according to the characteristics of the fourth wave, the fourth wave of the group of five waves constitutes the target that may bottom out in the next adjustment of the market.
The fifth wave is weak: the rising target of the fifth wave can usually be accurately predicted in the following two ways:
(1) If the third wave is an extended wave, the length of The 5th Wave will be the same as that of the first wave;
(2) The running length of the fifth wave and the first wave to the third wave may be maintained by the magic number ratio of 6 1.8%.
The 5th Wave should be subdivided into five waves at a lower level. According to the lift analysis above, the fifth wave is often far less than the third wave, and so is the volume. Therefore, in the trend chart of strength indicators, the price of the fifth wave rises, while the relative strength weakens, which naturally constitutes a deviation phenomenon. Because the intensity of The 5th Wave tends to weaken, sometimes it will form a diagonal triangle, or commonly known as the rising wedge-shaped consumption trend. In the diagonal triangle, the fourth wave will overlap with the first wave, which is the only acceptable deviant trend (the wave counting rule originally stipulated that the bottom of the fourth wave should not be lower than the top of the first wave). After the diagonal triangle has completed the journey, it is expected that the market situation will turn sharply and the speed will be adjusted to the place where the diagonal triangle begins to run. Market psychology is generally one-sided optimistic, which is another deviation phenomenon when analyzed in combination with the weakening of rising strength and the decline of trading volume.
In addition, it is worth noting that the fifth wave sometimes fails and the vertex cannot rise above the top of the third wave.
This form is relatively rare, and the focus of identification is to count five complete waves in the fifth wave.
Wave a and wave b:
Wave A is the first of the three adjustment waves.
If a wave can only be divided into three waves at a lower level, then its meaning can be analyzed from two aspects.
First, the downward adjustment is weak;
Second, the whole adjustment market may appear in a flat form.
In other words, the rise of B wave may recover most of the lost land of A wave. Under normal circumstances, A wave can be subdivided into five waves at a lower level, reflecting that the whole adjustment market will run in zigzag waves. In this case, according to the basic principle of downstream five waves, the mainstream trend will follow the direction of A wave, and the retreat of B wave will be 38.2%, 50% or 6 1.8% of A wave.
Whether zigzag or flat, B wave will always appear in the form of a combination of three waves, and it is impossible for B wave to be divided into five waves at a lower level.
If A wave runs in a combination of three waves, B wave can slightly exceed the starting point of A wave in an irregular shape.
Chart analysts should be extra careful when analyzing and adjusting the wave market because of the variety. For example, three waves may form a flat adjustment wave, but they can also represent the adjustment wave of the whole sawtooth (A, B, C).
Based on the above analysis, due to the trend of a group of three waves, it may represent the A wave of the flat adjustment wave or the whole sawtooth adjustment wave. Therefore, it can be expected that the market will at least rebound to the starting point of A wave, and even surpass the starting point of A wave. The latter means that the adjustment market appears as an irregular flat wave, or a new push wave has begun to run.
On the whole, if we find the market trend after the adjustment of three waves, we can predict that at least three waves will run in the opposite direction.
C wave and x wave:
C wave is the end of the adjustment wave.
C wave should be divided into five waves at a lower level, so C wave can also be regarded as a traitor with five waves downstream and three waves upstream. The five waves of "C Wave" represent the whole process of market adjustment, and the market will pick up.
In the flat adjustment wave, most C waves are lower than A waves, and the common magic number ratio is 1, that is, the length of A waves is the same as that of C waves.
On the other hand, when ABC wave runs in zigzag, the lengths of A wave and C wave will tend to be the same. In other words, the low point of C wave will naturally be lower than the bottom of A wave.
The appearance of X waves often puzzles wave analysts.
To put it simply, the adjustment waves are various, sometimes running in complex forms, which may include two or more simple adjustment forms; X-wave's job is to undertake several different groups of adjustment waves.
Move your right shoulder. Five waves are over. The trend is no longer strong, callback or U-turn.