Triangles appear to reflect a balance of forces, causing a sideways movement that is usually associated with decreasing volume and volatility. Triangles contain five overlapping waves that subdivide 3-3-3-3-3 and are labeled a-b-c-d-e. A triangle is delineated by connecting the termination points of waves a and c, and b and d. Wave e can undershoot or overshoot the a-c line, and in fact, our experience tells us that it happens more often than not.

There are two varieties of triangles: contracting and expanding. Within the contracting variety, there are three types: symmetrical, ascending, and descending, as illustrated in Figure 1-42. There are no variations on the rarer expanding triangle. It always appears as depicted in Figure 1-42, which is why Elliott termed it a "reverse symmetrical" triangle.

Figure 1-42

Figure 1-42 depicts contracting triangles as taking place within the area of preceding price action, in what may be termed regular triangles. However, it is extremely common for wave b of a contracting triangle to exceed the start of wave a in what may be termed a running triangle, as shown in Figure 1- 43. Despite their sideways appearance, all triangles, including running triangles, effect a net retracement of the preceding wave at wave e's end.

Figure 1-43

There are several real life examples of triangles in the charts in this course. As you will notice, most of the subwaves in a triangle are zigzags, but sometimes one of the subwaves (usually wave c) is more complex than the others and can take the shape of a regular or expanded flat or multiple zigzag. In rare cases, one of the sub-waves (usually wave e) is itself a triangle, so that the entire pattern protracts into nine waves. Thus, triangles, like zigzags, occasionally display a development that is analogous to an extension. One example occurred in silver from 1973 through 1977 (see Figure 1-44).

Figure 1-44

Although upon extremely rare occasions a second wave in an impulse appears to take the form of a triangle, triangles nearly always occur in positions prior to the final actionary wave in the pattern of one larger degree, i.e., as wave four in an impulse, wave B in an A-B-C, or the final wave X in a double or triple zig-zag or combination (to be shown in Lesson 9). A triangle may also occur as the final actionary pattern in a corrective combination, as discussed in Lesson 9, although even then it always precedes the final actionary wave in the pattern of one larger degree than the corrective combination.

In the stock market, when a triangle occurs in the fourth wave position, wave five is sometimes swift and travels approximately the distance of the widest part of the triangle. Elliott used the word "thrust" in referring to this swift, short motive wave following a triangle. The thrust is usually an impulse but can be an ending diagonal. In powerful markets, there is no thrust, but instead a prolonged fifth wave. So if a fifth wave following a triangle pushes past a normal thrust measurement, it is signaling a likely protracted wave. Post-triangle advancing impulses in commodities at degrees above Intermediate are usually the longest wave in the sequence, as explained in Lesson 29.

On the basis of our experience with triangles, as the example in Figure 3-15 illustrates, we propose that often the time at which the boundary lines of a contracting triangle reach an apex coincides exactly with a turning point in the market. Perhaps the frequency of this occurrence would justify its inclusion among the guidelines associated with the Wave Principle.

The term "horizontal" as applied to triangles refers to these corrective triangles in general, as opposed to the term "diagonal," which refers to those motive triangular formations discussed in Lesson 5. Thus, the terms "horizontal triangle" and "diagonal triangle" denote these specific forms under the Wave Principle. The simpler terms "triangle" and "wedge" may be substituted, but keep in mind that technical chart readers have long used these terms to communicate less specifically subdivided forms defined only by overall shape. Having separate terms can be useful.