October 22, 2021

NeoWave Wave Theory by Glenn Neely. Description of the fifth rule of correlation of wavelengths and conditions for its implementation a, b.

11 min read
NeoWave Wave Theory by Glenn Neely. Description of the fifth rule of correlation of wavelengths and conditions for its implementation a, b.

In this tutorial, we will consider the fifth rule of wavelength relationships.

Rule 5

For rule 5 to take effect, is necessary, so that the wave m2 moves in the opposite direction with respect to m1 and reaches from 100% up to 161,8% (not including) 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.

Condition (a). m0 less than 100% m1.

Under this condition, two options are considered:

  1. When m2 consists of four or more monowaves or
  2. When m2 consists of three inclusive or less.

First. If m2 is a composite wave and consists of more than three monowaves.

1.     If the length of the first three monowaves m2 is less than or equal to 61,8% wave amplitudes m1, then the first or second of these monowaves, formed immediately after m1, may start a complex correction. In this case, the initiating correction of the monowave should be directed opposite to m1 and, in one of the variants, can be an x-wave. As for the alternatives, then under certain circumstances it may include «invisible» x-wave either «invisible» b-wave. Also, m1 may be the third wave of the impulse price pattern (terminal or trend) with a failed fifth. At the endpoint m1, the notation «:5/:s5».

Wherein:

  • If the length of the first three monowaves, following m1, cumulatively from 25% length m1, then it’s worth adding to the structural list m1 «:F3».
  • Considering the situation, when the x-wave is missing, you should circle the central part m1 in a circle to the left of it write «:s5», and right – «x:c3?».
  • If option is considered «invisible» b-waves, then you should circle the central part of m1 in a circle to the left of it, write «:5?», and right – «b:F3?». In this case, the hypothesis of the completion of a complex correction should be considered the only right option immediately after passing the point of a sharp turn of the market in the opposite direction to the direction of development m1, after reaching the wave, next to m1 of value 61,8% amplitudes m1.

2.     If the length of the first three monowaves m2 is more than 61,8% wave amplitudes m1, then m1 can either complete the a-wave plane, complex b-wave, or the third wave of a pulsed price figure with a failed fifth. So, at the endpoint m1, we should put the notation «:F3/:5».

Second. If m2 is a composite wave and consists of no more than three monowaves or is a monowave.

1.     If the level of the starting point is m1 (plus one unit of time) achieved over the period, less than or equal to the formation time m1 and price projections m(-2) and m0 do not overlap even partially, and m2 is longer than m in length(-2), and lengths and/or duration m(-2) and m0 differ markedly from each other, and m(-1) has a greater amplitude, than m1 and/or m(-3), then with high probability, m1 may be the ending trend pulse segment. So the endpoint should be marked «:L5».

2.     If the level of the starting point is m1 (plus one unit of time) achieved over the period, less than or equal to the formation time m1, m2 is longer than m(-2), and m(-4) longer than m(-3), then m1 may be the last zigzag segment or plane wave. So the endpoint should be marked «:L5».

3.     If the initial wave level is m1 (plus one unit of time) achieved over the period, less than or equal to the formation time m1, m2 is longer than m(-2) and m(-3) exceeds in length m(-2) and m(-4), then wave m1 can complete the standard price pattern, included in a complex correction, in which m(-2) is an x-wave. In this case, the endpoint m1 is worth noting «:L5», and at the endpoint m(-2) – «x:c3?».

If, under the conditions described above, the amplitude m(-1) is 161,8% and more wavelength m0, forming standard correction – most likely, zigzag. If the amplitude m(-1) is not less than 100%, but less than 161,8% length m0, then, Most likely, flat standard correction is formed.

4.     If the level of the starting point is m1 (plus one unit of time) achieved over the period, less than or equal to the formation time m1, m2 is inferior in length to m(-2), then m1 is the final link of a flat or zigzag. The endpoint should be marked «:L5».

5.     If the initial wave level is m1 (plus one unit of time) achieved over the period, less than or equal to the formation time m1, m(-2) inferior in length to m(-1), m(-1) not shorter than waves m(-3) and m1 simultaneously, the amplitude of m3 is up to 61,8% m2 inclusive, starting point level m(-3) is achieved (either intersects) for a period of time, no more than half the period from the start of m(-3) to the end of wave m1, the final level m1 does not intersect during four periods of price formation from the beginning of m(-3) to the end of wave m1, as well as the price projection of waves from m2 to m4 exceeds at least 2 times the price projection m1, as well as «:c3» is one of the likely structural notation m(-1), then m1 may be the last segment of the terminal pulse. Add «:L3».

6.     If the level of the starting point is m1 (plus one unit of time) achieved over the period, less than or equal to the time of its formation, and the amplitude m3 lies in the range of 61,8% up to 100% length m1, then m1 may be a component of the irregular failed flat. So the endpoint should be marked «:F3».

7.     If the initial wave level is m1 (plus one unit of time) achieved over the period, less than or equal to the time of its formation and the amplitude m3 exceeds the length m2 and the length m0 is at least 161,8% amplitude m2, as well as the level of the starting point m3 is reached over a period of time, less than or equal to m3 duration, then m1 may be a segment of an irregular flat. Its endpoint should be marked «:F3».

8.     If the level of the initial point m1 is reached for a period longer than the time of its formation, length m2 is 61,8% or less than the price distance from the beginning of the wave m(-1) to the end of m1, m3 is inferior in length to m2, means there is a high probability, that in this case the formation of complex correction is completed. Moreover, over two durations of the wave group m0-m2, the extremum point, formed by m1, will remain a global extreme. At the endpoint m1, the notation «:F3».

9.     If the level of the initial point m1 is reached for a period longer than the time of its formation, m3 in amplitude exceeds m2, length m2 is 61,8% or less than the price distance from the beginning of the wave m(-1) to the end of m1, then at the moment a complex correction or an expanding triangle may form. In the first case, the end of one correction phase may be m1, and x-wave – m2. Add to the structure list «:F3/:c3/:L5».

10. If the initial wave level m1 is reached during the period, longer time of its formation and m2 shorter than m(-2), then m1 may be the final zigzag segment, which is part of a tapering triangle. The endpoint should be marked «:L5».

11. If the level of the initial point m1 is reached for a period longer than the time of its formation, amplitude m(-1) is at least 61,8% amplitudes m1, m3 shorter than m2, and the level of the starting point m3 (plus one unit of time) achieved in a time less than or equal to the time extent m3, then m1 may be part of a flat, which completes the larger price pattern. At the endpoint m1, the notation «:F3».

12. If m3 is longer than m2, m4 is longer than m3, and the amplitude m0 is up to 61,8% (not including) m1, then m1 can start an expanding triangle. Its endpoint should be marked «(:F3)».

13.  If m3 is longer than m2, m4 is longer than m3, and the amplitude m0 is from 61,8% up to 100% m1, the formation of an expanding triangle is possible. Its endpoint should be marked «(:c3)».

First, we define, what rule and condition does the current market situation correspond to. Wave m2 moves in the opposite direction with respect to m1 and reaches from 100% up to 161,8% its length. So in our case, rule 5 works.

The amplitude of the monowave m0 is up to 100% wavelength m1. So in our case the second part of the condition holds (a) rules 5.

Now we will determine the appropriate clause of the condition (a). Since the level of the starting point m1 (plus one unit of time) achieved over a period approximately equal to the formation time m1, m2 markedly exceeds m in length(-2) and m(-4) noticeably longer than m(-3), then in our case the criteria of the second clause of the condition are satisfied (a). Hence, m1 may be the last zigzag segment or plane wave. So the endpoint should be marked «:L5».

Condition b. m0 from 100% up to 161,8% (not including) m1.

1.    If m3 is longer than m2, the amplitude m0 approaches more than 100% wavelength m1, than to 161,8%, then at the endpoint m1 it is worth putting the notation «:c3».

Wherein:

  • If m(-1) exceeds in length m0 and «:c3» is the preferred option, then this designation should be replaced by «b:c3». In this case, the b-wave of the plane correction is the wave m1.
  • If m(-1) inferior in length to m0, then m1 may be the x-wave of complex correction. So the current designation should be replaced by «x:c3».

2.     If m3 is longer than m2, the amplitude m0 approaches more than 161,8% wavelength m1, than to 100%, then at the endpoint m1 it is worth putting the notation «:F3».

Wherein:

  • If m(-1) exceeds m0 in length, then m2 can complete the zigzag.
  • If m(-1) inferior in length to m0, then m1, probably, is the x-wave of complex correction, which ends with the m4 wave.

To describe both alternatives, add to the structure list «b:c3» and «x:c3».

3.     If m3 is at least 61,8% length m1, m3 does not cross the endpoint level m2, and m2 is close to 61,8% amplitudes m0, then m1 may be the first phase of an irregular failed flat. Add to the structure list «:F3».

4.     If m3 is less than 100% amplitude m2, but not inferior to 61,8% length m1, and also m3 does not cross the endpoint level m2, then add to the structure list «:F3».

5.     If m3 is less than 61,8% amplitude m2, price projections m3 and m1 overlap each other, the amplitude of m4 is not more than 261,8% lengths m2 and m2 are longer than m0 and/or m4, starting point level m4 (plus one unit of time) achieved over time, inferior to its duration and the level of the initial point m0 ​​is reached over the period, not more than half the time from the beginning of m0 to the end of m4, then m4 can complete the terminal figure. The endpoint m1 should be marked «(:c3)».

but, if present in the structure list «:F3», it should be enclosed in square brackets. Thus we denote, what is the probability of the option «(:c3)» higher.

6.    If the level of the starting point is m1 (plus one unit of time) achieved over time, less than or equal to the duration of its formation, amplitude m2 reaches almost 161,8% length m1, amplitude m3, in turn, less than 61,8% wavelength m2, length m(-1) is at least 61,8% amplitudes m0, length m(-2) ranging from 61,8% up to 161,8% amplitudes m(-1), amplitude m(-3) ranging from 61,8% up to 161,8% amplitudes m(-2), as well as the price projection of a group of waves from m2 to m1 can complete a tapering triangle, then in the structural list m1 you should add the notation «:L3».

7.     If the level of the starting point is m1 (plus one unit of time) achieved over time, less than or equal to the duration of its formation, amplitude m1 reaches almost 161,8% length m(-1), wavelength m2 almost reaches 161,8% m1, length m3 less than 61,8% length m2, as well as the price projection of a group of waves from m2 to m1 can complete a flat price figure. So, in the structural list m1, we should add the notation «:L5».

8.     If m(-1) inferior in length to the wave m0, starting point level m2 (plus one unit of time) achieved over time, inferior or equal to the formation time of this wave, and m0 is not inferior in length to at least one of the waves m(-2) and m2, and the level of the starting point m(-2) is reached or even intersects for no more than half the time period, passed from the starting point of the wave m(-2) to final m2, then, most likely, m2 is the terminal segment of the terminal impulse. So, in the structural list of wave m1, we should add the notation «:sL3».

9.     If the current market situation does not meet any of the conditions described above, and m1 is a monopole, then at its endpoint you should put all the notation for this section, namely: «:F3/:c3/:5/:L5(:L3)».

10. If the current market situation does not meet any of the conditions described above, and m1 is a compact composite wave (polywave), or a higher level price figure, it is necessary to determine, which of the position indicators should be placed before the designation of this compact wave. More on position indicators, their differences and methods of application we will talk in one of the following articles.

First, we define, what rule and condition does the current market situation correspond to. Wave m2 moves in the opposite direction with respect to m1 and reaches from 100% up to 161,8% its length. So in our case, rule 5 works.

The amplitude of the monowave m0 is from 100% up to 161,8% wavelength m1. In our case, the second part of the condition (b) rules 5.

Now choose the appropriate clause (b). Wave m3 significantly exceeds in length m2. Moreover, a closer look at the graph shows, that the price amplitude m0 approaches a little more to 100% wavelength m1, than to 161,8%. So at the endpoint m1 it’s worth putting the notation «:c3».

Consider the following condition. Wave m(-1) exceeds in length m0 and, as we just understood, «:c3» is the preferred option. Therefore, the current designation should be replaced by a designation «b:c3». In our case, the b-wave of the plane correction is the wave m1.

But if m(-1) inferior in length to m0, then m1 could be the x-wave of complex correction. In this case, the designation «:c3» we would replace with «x:c3».