 NeoWave Wave Theory by Glenn Neely. Description of conditions b, c and d for the sixth rule. • ForexTalker

# NeoWave Wave Theory by Glenn Neely. Description of conditions b, c and d for the sixth rule. We continue to consider the sixth rule of wavelength relations. Next, conditions b, c and d, since condition a we examined in the previous article.

Contents

## Rule 6

To start, I recall its conditions. Wave m2 moves in the opposite direction with respect to m1 and reaches from 161,8% up to 261,8% (inclusive) its length. When measuring the ratios m0 to m1, we select one of the following conditions and assign the structure symbols corresponding to the selected condition to the waves.

### If m3 is multi-wave and consists of more than three monowaves, then:

1.    If the length of the first three monowaves m3 is no more than 61,8% wave amplitudes m2, then the first or second of these monowaves, formed immediately after m2, may start a complex correction. In this case, the beginning of the correction of the monowave should be directed opposite to m2 and may be an x-wave. In alternative cases, the x-wave is in the center of m2, that is, is «invisible», either m2 is the third wave of the trend, either a terminal impulse price pattern with a failed fifth. So in the structure list m1 we add the notation «(:5/:s5)».

Considering the situation, when the x-wave is «disappeared», you should circle the central part of m2 in a circle to the left of it write «:5?», and right – «:F3/x:c3?».

The option to complete a complex correction will be confirmed immediately before the point, where the market will dramatically change its direction (opposite to m2), and the amplitude of m3 will be more than 61,8% amplitude m2.

2.    If the amplitude of the first three monowaves m3 is more than 61,8% length m2, then m2 can either complete the a-wave flat, in which there is also a complex b-wave, or the third wave of a pulsed price figure with a failed fifth. Under the circumstances, at the endpoint m1 we put the notation, describing both alternatives – «:F3/:5».

### If m3 is polywave and consists of no more than three monowaves (or groups of monowaves) either is monowave, then:

1.     If the time length m1 does not exceed the duration m0 or the wavelength m2, m(-2), in turn, inferior in price length m(-1), then m1 can be an x-wave of complex correction. So we add the notation to the structural list «x:c3».

2.     If the time length m1 is greater than or equal to the duration m0 or the wavelength m2, and also the amplitude m0 is about 161,8% length m1, then m1 may be part of a momentum or zigzag. So we add the notation to the structural list «:F3».

3.     If the level of the starting point is m1 (plus one unit of time) achieved by m2, less than or equal to the time of its formation, and m3 is less than 61,8% or more than 100% length m2, during, not exceeding the duration of formation m2. In this case, the price and time extent m(-1) at least 61,8% corresponding parameters m1, as well as m1 is a compact price figure, provided, that not a single part of it crosses the level of its starting point. Subject to the satisfaction of these conditions, with high probability, m1 is the final segment of the c-wave of a plane. So its endpoint should be marked «:L5».

4.     If the level of the starting point is m1 (plus one unit of time) achieved by m2, less than or equal to the time of its formation. Wherein, m3 is less than 61,8% amplitude m2, and price and time extent m(-1) at least 61,8% corresponding parameters m0, there is a fairly high probability, that m1 is the final link of a tapering triangle or completes one of several varieties of flat (here the most likely option should be determined depending on the price extent m(-1)). To reflect both assumptions, the notation should be added to the structural list m1 «:L3/:L5».

but, if m1 is a multi-wave and no part of this wave crosses the level of its starting point, then «:L5» cross out of the list.

5.     If the initial level m1 is reached during the period, longer time of its formation, m2 is longer than m(-1) and m0, as well as m2 is a polywave, consisting of three or more monowaves, then m1, with high probability, is one of the central segments of the triangle. At the endpoint m1 we put the notation «:c3».

6.     If the level of the starting point m2 (plus one unit of time) achieved over time, less than or equal to the time of its formation, and m0 is longer than m(-2) and/or m2 waves. In this case, the level of the initial point m(-2) reached or crossed over time, not exceeding half the wave group development time m(-2)–m2, then when all the above conditions are satisfied, m2 may be the final link of the terminal price figure. So in the structure list m1 we add the notation «(:sL3)».

7.     If the price amplitude m3 is from 101% up to 161,8% similar parameter m2, then, most likely, on this plot of the graph is the formation of an expanding triangle. With this development of events, the designation «:F3» should be enclosed in square brackets, thereby showing, that its probability is lower than the option «:c3».

Check, Does the market situation in question meet the criteria for the condition? (b) rules 6. The chart above shows, that the amplitude of the m2 wave is slightly less than 261,8% wavelength m1. The requirements of the sixth rule are fulfilled.

Check, which of the conditions criteria (b) corresponds to the wave structure. In the chart above we see, that the amplitude of the wave m0 falls in the range from 100% up to 161,8% wavelength m1, and m3 is polywave, but consists of only two monowaves (it is clearly visible in the chart below). In our case, the second condition criterion (b) rules 6.

Now it remains to determine, to which point of the criterion does the considered structure correspond. In the chart above we see, that the time extent m1 is greater than or equal to the duration m0. Hence, since in the previous chart we defined, that the wave m0 is approximately equal to the length 1,618 from wave m1, then we can argue, that m1 can be part of a pulse or zigzag with the designation «:F3».

Now consider the condition (with) and its criteria.

### Condition (c). If m0 from 161,8% up to 261,8% (inclusive) m1, then:

1.    m1 is the final segment of a tapering triangle or a strict flat with a failed C,  where, to reflect assumptions, the notation should be added to the structural list m1 «:L3/(:L5)» (designation «:L5» enclosed in brackets, as a less likely option) subject to the following two criteria:

• If the level of the starting point is m1 (plus one unit of time) achieved by subsequent waves over the period, which is less than or equal to the time of its formation and m3 is less than 61,8%.
• If the amplitude m2 exceeds the length m0 over a period of time, equal to wave formation time m0 and amplitude m(-1) ranging from 61,8% up to 161,8% the length of the price m0 and the price projection m2 exceeds m0, and its slope is more vertical, than wave m0.

2.     If the level of the starting point is m1 (plus one unit of time) achieved by m2, less than or equal to the time of its formation, waves m(-1) and m1 overlap each other, the price amplitude m0 is equal to or greater than the same parameter m(-2) and/or m2 waves, and the level of the starting point m(-2) achieved or crossed over time, no more than 50% the development time of the wave group m(-2)–m2, then when all the above conditions are satisfied, we can assume, that m2 may well be the final segment of the terminal price figure. Therefore, in the structural list m1 should be added «:sL3».

3.     If the price amplitude m3 is from 101% up to 161,8% similar parameter m2, then, with a small probability, on this plot of the graph, the formation of an expanding triangle may occur. So we add the notation to the structural list «(:c3)».

4.     If none of the criteria 1,2 or 3 is not satisfied, then m1 gets the notation «:F3».

We’ll check first, Does the current market situation correspond to the description of rule 6. The chart above shows, that the amplitude of the m2 wave is a little more than 161,8% length m1. Hence, the requirements of the sixth rule are met.

The next step is to verify the condition (with). The chart above shows, that the amplitude of the wave m0 falls in the range from 161,8% up to 261,8% wavelength m1. In our case, the condition (c) rules 6.

Since m0 is a sufficiently long wave (in amplitude comparable to m2 and m3), and m2 wave is longer than m3, then none of the criteria 1,2 and 3 conditions (with) rule 6 is not implemented, in the vicinity of the point m1 we put the notation «:F3», according to the fourth criterion.

### Condition (d). If m0 is more than 261,8% m1, then:

1.     If the time length is m0 or m2 (in both cases minus one unit of time) inferior to or equal to the same parameter m1, and duration m1, in turn, simultaneously inferior to time lengths in the aggregate of waves m0 and m2, then wave m1 can either start a larger correction or be the final segment of a zigzag or impulse price pattern. In this case, it is necessary to put the notation at the endpoint m1 «:F3».

2.     If the length of m3 is less than 61,8% price amplitude m2, total wavelength group m2–m4 is less than or equal to the time extent m0, price projection of wave group m2–m4 more than the price projection of the wave m0, and its motion in comparison with the wave m0 occurs at a more vertical angle, you should consider the small probability, that m1 is the final segment of a tapering triangle or strict flat with a failed C. At the endpoint m1 we put the notation «(:L3)/[:L5]», reflecting both described alternatives.

3.     If the level of the starting point m2 (plus one unit of time) achieved over time, less than or equal to the time of its formation, and the waves m(-1) and m1 overlap each other. Wherein, the price amplitude m0 is greater than or equal to the wavelength m(-2) and/or m2 waves, and the level of the starting point m(-2) is achieved (either intersects) for the time period, no more than half the time of formation of the wave group m(-2)–m2, then when all the above conditions are satisfied, we can assume, that the m2 wave is the final link in the terminal price figure. A, hence, in the structural list m1 it is worth adding the notation «:sL3».

### Consider the condition (d) rule 6 for example:

Check, Does the current market situation meet the criteria for the condition? (d) rules 6. The chart above shows, that the amplitude of the m2 wave is a little over 161,8% length m1. Hence, the requirements of the sixth rule are met.

The next step is identifying the condition for rule 6. The chart above shows, that the amplitude m0 is more than 261,8% m1 wavelength m1. So in our case the condition (d) rules 6.

Since the time lengths m0 and m2 separately (in both cases minus one unit of time) inferior to or equal to the same parameter m1(blue areas individually shorter, than green), and length m1, in turn, simultaneously inferior to the time lengths of the waves m0 and m2 in the aggregate(the green area is shorter, than the length of the blue areas together), then wave m1, most likely, can either start a larger correction or be the final segment of a zigzag or impulse price pattern. In this case, the endpoint m1 must be denoted «:F3».