- Wave 2 : a wave 2 is a corrective wave that usually will retrace .618 to .786 of the prior wave 1 in the form of a zig zag. . Sometimes it will even go as far as 100% of wave 1. The only rule that must not be broken is that it MUST under no circumstance break the wave 1 starting point.
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| These are examples of wave 2 formations and what they look like. For now we will just be concerned about identifying the lower zig zag formation. The best way to do this is to go and look at past charts and see if you can pick them out. EX(the Canadian dollar appears to be putting one in right now on the weekly chart) . The first clue that your count maybe correct is if you break the B wave on the upside if your looking at what you think may be a wave 2 zig zag. |
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