About the zigzag structure
The zigzag structure is one of the three core corrective patterns explained in the Elliott Wave theory. The other two are the Flat and Triangle structures. Typically, a zigzag structure is counter trend i.e. it develops against the prevailing market direction. Structurally, it’s a 3-swing structure – ABC structure.
Wave A is a 5-wave structure – could either be an impulse or a diagonal. Meanwhile, wave B could be any of corrective structures – zigzag, flat or triangle. Lastly, wave C can also be an impulse or diagonal. Meanwhile, while wave A and B can both be impulse, it’s very rare seeing both being a diagonal. Here are some other useful rules/guidelines:
1. Wave B does not correct more than 100% of wave A
2. Wave C breaks the low of wave A in a bearish structure and the high of wave A in a bullish structure
3. Wave C often extends to 100-123% of wave A from wave B. While it could extend more than 123.6%, it rarely extends more than 161.8% of wave A
At Elliottwave-forecast, the zigzag structure is one of our ‘bread and butter’ structure. We like buying at the 100% of wave A from B in a bearish zigzag structure along a bullish sequence. On the other hand, we like selling at the 100% of wave A from B in a bullish zigzag along a bearish sequence. While we like trading at the 100%, we like putting stop at the 161.8%. Let’s check a case study – a recent $YM_F setup.
Dow Futures (YM) chart – 11.15.2024
Since August 2024, the Dow futures (YM) resumed the larger bullish sequence from September 2022. In the short term, our intention was to buy pullbacks when they complete a 3-swing (zigzag) or a 7-swing (double zigzag) structure. A double zigzag pullback finished in early November and the Dow rallied sharply. However, another pullback would soon follow toward mid-November. Indeed, we identified a 3-swing structure (zigzag) which we expected to finish at the 43529-43063 Fibonacci zone. We then notified members with the chart below.
Dow Futures (YM) chart – 11.28.2024
We shared the chart below on 28th November 2024 – barely two weeks later. The Dow reached the extreme as we expected having completed a zigzag structure. Several days after, the index rallied for another impulse structure. The chart also shows another pullback emerging. This is a textbook example of a zigzag structure in a bullish sequence.
While the bullish sequence persists, buyers will continue to wait for pullbacks and buy at the extreme of a 3 or 7 swing structure.
FURTHER DISCLOSURES AND DISCLAIMER CONCERNING RISK, RESPONSIBILITY AND LIABILITY Trading in the Foreign Exchange market is a challenging opportunity where above average returns are available for educated and experienced investors who are willing to take above average risk. However, before deciding to participate in Foreign Exchange (FX) trading, you should carefully consider your investment objectives, level of xperience and risk appetite. Do not invest or trade capital you cannot afford to lose. EME PROCESSING AND CONSULTING, LLC, THEIR REPRESENTATIVES, AND ANYONE WORKING FOR OR WITHIN WWW.ELLIOTTWAVE- FORECAST.COM is not responsible for any loss from any form of distributed advice, signal, analysis, or content. Again, we fully DISCLOSE to the Subscriber base that the Service as a whole, the individual Parties, Representatives, or owners shall not be liable to any and all Subscribers for any losses or damages as a result of any action taken by the Subscriber from any trade idea or signal posted on the website(s) distributed through any form of social-media, email, the website, and/or any other electronic, written, verbal, or future form of communication . All analysis, trading signals, trading recommendations, all charts, communicated interpretations of the wave counts, and all content from any media form produced by www.Elliottwave-forecast.com and/or the Representatives are solely the opinions and best efforts of the respective author(s). In general Forex instruments are highly leveraged, and traders can lose some or all of their initial margin funds. All content provided by www.Elliottwave-forecast.com is expressed in good faith and is intended to help Subscribers succeed in the marketplace, but it is never guaranteed. There is no “holy grail” to trading or forecasting the market and we are wrong sometimes like everyone else. Please understand and accept the risk involved when making any trading and/or investment decision. UNDERSTAND that all the content we provide is protected through copyright of EME PROCESSING AND CONSULTING, LLC. It is illegal to disseminate in any form of communication any part or all of our proprietary information without specific authorization. UNDERSTAND that you also agree to not allow persons that are not PAID SUBSCRIBERS to view any of the content not released publicly. IF YOU ARE FOUND TO BE IN VIOLATION OF THESE RESTRICTIONS you or your firm (as the Subscriber) will be charged fully with no discount for one year subscription to our Premium Plus Plan at $1,799.88 for EACH person or firm who received any of our content illegally through the respected intermediary’s (Subscriber in violation of terms) channel(s) of communication.
Recommended content
Editors’ Picks

AUD/USD plummets to 0.6250, two-day lows
AUD/USD now retreats from the area of daily highs north of 0.6300 the figure and revisits the mid-0.6200s as investors continue to digest Trump's announcements on "Liberation Day".

EUR/USD loses the grip and retests 1.0800
The US Dollar is now picking up further pace and sends EUR/USD back to the 1.0800 neighbourhood following President Trump's announcements of reciprocal tariffs on Wednesday.

Gold remains well bid near $3,140 post-Trump tariffs
Gold maintains its bullish stance well in place and trade near its record highs in the wake of President Trump's announcement of reciprocal tariffs. In addition, declining US yields also collaborate with the metal's bounce.

Grayscale launches Bitcoin options ETF with a focus on income generation
In a press release on Wednesday, Grayscale announced the launch of Bitcoin options-based ETFs, the Grayscale Bitcoin Covered Call ETF (BTCC) and Grayscale Bitcoin Premium Income ETF (BPI).

Trump’s “Liberation Day” tariffs on the way
United States (US) President Donald Trump’s self-styled “Liberation Day” has finally arrived. After four straight failures to kick off Donald Trump’s “day one” tariffs that were supposed to be implemented when President Trump assumed office 72 days ago, Trump’s team is slated to finally unveil a sweeping, lopsided package of “reciprocal” tariffs.

The Best brokers to trade EUR/USD
SPONSORED Discover the top brokers for trading EUR/USD in 2025. Our list features brokers with competitive spreads, fast execution, and powerful platforms. Whether you're a beginner or an expert, find the right partner to navigate the dynamic Forex market.