Elliott wave pattern - Impulse (IM), Internal structure, Rules and Guidelines

An Impulse is a five-wave pattern labelled 1-2-3-4-5 moving in the direction of the larger trend.

Internal structure and the most common shape for a rising Impulse, Elliott wave pattern

Internal structure and the most common shape for a falling Impulse, Elliott wave pattern

Rules and guidelines for identifying and labeling an Impulse pattern
1) Wave 1 must itself be an Impulse or a Leading Diagonal pattern.
2) Wave 2 can be any corrective Elliott Wave pattern except a Triangle.
3) No part of Wave 2 can retrace more than 100% of Wave 1.
4) Wave 3 must be an Impulse.
5) Wave 3 must be longer than wave 2 by price.
6) Wave 4 can be any corrective Elliott Wave pattern.
7) Waves 2 and 4 cannot overlap (share common price area).
8) Wave 5 must be an Impulse or an Ending Diagonal.
9) Wave 5 must be at least 70% of the length of Wave 4 by price.
10) Wave 3 must never be the shortest by price when compared to Waves 1 & 5.


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