Question of the Week: 2/17/2010
In Chapter 8 of Mastering Elliott Wave you show many complex formations ending with contracting triangles. Is that how they should always end?
In the 80's, when I was collecting material for Mastering Elliott Wave, that is the way complex double and triple combination patterns behaved in nearly all markets. As the 90's rolled around that behavior began to change. The evolution continued into the new millennium. As a result, I now know it is not necessary to have a contracting Triangle at the end of complex corrections.
If the larger market environment is one of contraction, then it is likely you will see complex double and triple combination patterns ending with contracting Triangles. If the larger environment is expanding, the last leg of a complex formation is likely to end with an expanding Triangle. Depending on the environment, virtually any combination of Flats, Zigzags, Triangles and Diametrics is possible to begin, end (or occur in the middle of) a double or triple combination correction.
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