The Elliot wave is a belief that investor sentiment has predictable patterns. A trader could basically trace this wave in order to make a profit, he says. The rules on and of the Elliot wave are as follows: Wave two cannot retrace more than the beginning of wave one.Wave three cannot be the shortest wave of the three impulse waves,. Wave four does not overlap with the price territory of wave 1. That's where we started. Wave five needs to end with momentum divergence. Are you with me? Absolutely. I mean, why don't you be? You know, I was going to define a double bottom and give an example like that. It's kind of a W-shaped pattern