Elliott wave pattern - Diagonal [Leading (LD) and Ending (ED)], Internal structure, Rules and Guidelines

Diagonal – also known as a Diagonal Triangle is a common 5-wave motive pattern labelled 1-2-3-4-5 that moves with the larger trend. Diagonals move within two contracting channel lines drawn from waves 1 to 3, and from waves 2 to 4. Other than an Impulse, Diagonal is the only other Elliott Wave pattern that moves with the larger trend.

There exist two types of Diagonals: Leading Diagonals (LD) and Ending Diagonals(ED). They have a different internal structure and are seen in different positions within the larger degree pattern. Ending Diagonals are much more common than Leading Diagonals.

Internal structure and the most common shape for a rising Leading Diagonals (LD), Elliott wave pattern

Internal structure and the most common shape for a rising Ending Diagonals(ED), Elliott wave pattern


Rules and guidelines for identifying and labeling a Diagonal pattern
1) Diagonals move within two converging channel lines
2) Wave 1 of a Leading Diagonal is an Impulse or a Leading Diagonal.
3) Waves 1, 3 and 5 of an Ending Diagonal are always a Zigzag family pattern.
4) Wave 2 may be any corrective pattern except a Triangle.
5) Wave 2 is never longer than Wave 1 by price.
6) Wave 3 of a Leading Diagonal is an Impulse.
7) Wave 3 is always greater than Wave 2 by price.
8) Wave 4 may be any corrective pattern.
9) Waves 2 and 4 must share some common price territory (must overlap).
10) Wave 5 of a Leading Diagonal is either an Impulse or Ending Diagonal.
11) Wave 5 must be at least 50% of Wave 4 by price.
12) Wave 3 must not be shortest by price when compared with Waves 1 and 5.


Other Posts of Interest 
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Elliott wave pattern - Zigzag (ZZ), Double Zigzag (DZ), Triple Zigzag (TZ), Internal structure, Rules and Guidelines
Elliott wave pattern - Flat (FL), Double Sideways (D3), Triple Sideways (T3), Internal structure, Rules and Guidelines
Elliott wave pattern - Triangle [Contracting (CT) and Expanding (ET)], Internal structure, Rules and Guidelines

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