Now observe that within the corrective pattern illustrated as wave [2] in Figure 1-3, waves (A) and (C), which point downward, are each composed of five waves: 1, 2, 3, 4 and 5. Similarly, wave (B), which points upward, is composed of three waves: A, Band C. This construction discloses a crucial point: Motive waves do not always point upward, and corrective waves do not always point downward. The mode of a wave is determined not by its absolute direction but primarily by its relative direction. Aside from five specific exceptions, which will be discussed later in this course, waves divide in motive mode (five waves) when trending in the same direction as the wave of one larger degree of which it is a part, and in corrective mode (three waves or a variation) when trending in the opposite direction. Waves (A) and (C) are motive, trending in the same direction as wave [2]. Wave (B) is corrective because it corrects wave (A) and is countertrend to wave [2]. In summary, the essential underlying tendency of the Wave Principle is that action in the same direction as the one larger trend develops in five waves, while reaction against the one larger trend develops in three waves, at all degrees of trend.
*Note: For this course, all Primary degree numbers and letters normally denoted by circles are shown with brackets.
Essential Concepts
Figure 1-4
The phenomena of form,
degree and relative direction are carried one
step further in Figure 1-4. This illustration reflects the
general principle that in any market cycle, waves will subdivide
as shown in the following table (see section 1.6).
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