DEFINITION of 'Wolfe Wave'
In technical analysis, it is a naturally occurring trading pattern present in all financial markets. The pattern is composed of five waves showing supply and demand and a fight towards an equilibrium price. These patterns can develop over short- and long-term time frames such as minutes or weeks and are used to predict where a price is heading and when it will get there.
*Trend lines MUST converge in order for a pattern to qualify as a Wolfe Wave.
Wolfe Waves With Harmonics.png
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