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Elliott Waves Theory – Trading with Double and Triple Combinations

Double and triple combinations are one of the most common, if not the most common, complex corrections. Double combinations appear at least as often, and it is essential to understand where they form, and what the patterns are that appear after that. In our Forex Trading Academy, we will cover the two patterns in two different articles, and there’s a genuine reason for that: They are very important. This article will deal with the overall concept of double and triple combinations, where they appear, and what the standard interpretation is, while the other one will deal with how to trade Forex with such patterns. Before starting, let’s try to categorise them within the overall Elliott Waves structure. First of all, they are complex corrections, so we’re not looking for any rule of impulsive waves, but only for those related to corrective waves. Secondly, being complex corrections, there is at least one x-wave to interpret.

Defining Double and Triple Combinations

One thing that these patterns do have in common is the fact they almost always end with a triangle. In the case of a double combination, it is possible for the second simple correction to be a flat or a zigzag as well, even though this is quite rare. When it comes to triple combinations, though, a triangle needs to be found at the end.

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double and triple combinations1A double combination is a complex correction that has an x-wave, or an intervening wave. This complex correction falls into the category of complex corrections with a small x-wave, so the length of this intermediary wave is already known (it should not end anywhere beyond 61.8% of the previous first correction). As with any complex correction, a double combination cannot start with a triangle, so it is mandatory to have either a flat or a zigzag pattern as the first correction in a double combination pattern. The second correction will almost always be a triangle, but it can occasionally  be a flat or a zigzag. As a rule of thumb, if the first correction is a zigzag, the second one will be a flat; or if the first correction is a flat, the second one will be a zigzag (that is, if the second correction is not a triangle). If this rule is not respected, the pattern will fall into a double zigzag or flat category. Double combinations are to be found anywhere; the commonest places, not necessarily in the order of their appearance, are as follows:

We mentioned in other articles that complex corrections with a small x-wave are far more common than those with a large x-wave. Now it is time to add that, of all the complex corrections with a small x-wave, double combinations are the ones that form most often by far. That being the case, expect them all over the place, and don’t be surprised to see a double combination following another double combination pattern, either of the same or a different degree. The key to interpreting them correctly remains, as always, with the x-wave and the all-important golden ratio retracement.

Triple Combinations

double and triple combinations2A triple combination is a form of complex correction that has no less than three corrective waves, connected by two small x-waves. In total, we’re talking about five different corrective waves that form one after the other, and this tells much about the complexity of this pattern. As a matter of fact, this is one of the most complex corrections ever discovered by Elliott. Any pattern you’ll find in this project that has the name “triple” attached to it represents the maximum degree of complexity for an Elliott Waves pattern. The rule regarding the nature of the first correction applies in this case as well: It cannot be a triangle. This leaves room for either a flat or a zigzag pattern to start the triple combination, and because of that, we will have either a triple combination that starts with a zigzag, or a triple combination that starts with a flat. The two intervening x-waves are simple or complex corrections in their own right, and they cannot end beyond 61.8% of the previous correction. To find out this termination point, you simply need to use a Fibonacci retracement tool and measure the length of the previous correction, from its beginning to its end; find the golden ratio; and make sure the x-waves do not end beyond that level. A triple combination always ends with a triangle, and therefore we can make an educated guess about the nature of the first simple correction (either a zigzag or a flat), and the nature of the last one.

All we have to find next is the nature of the second correction. This cannot be a triangle either, so we’re either looking for yet another zigzag or a flat pattern. As for the places where a triple combination may appear, there are not many options for it. Usually, like 90% of the time, it is the longest leg of a triangle. When this happens, look for the triangle to be a contracting one, rather than an expanding one. Moreover, if it is a contracting triangle and the triple combination is the longest leg, then this triple combination can be either the a-wave of a horizontal triangle or the b-wave of an irregular one. In any case, a triple combination is not retraced by a wave of the same degree, so look to incorporate this small but important detail in your analysis.

All in all, double and triple combinations are the most important complex corrections in Elliott Waves theory, and understanding their formation and where they appear is critical for a correct Elliott count. The next article dedicated to these two patterns will deal with how exactly to  trade Forex with them.

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Double and Triple Combinations in Forex
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