Markets move in predictable patterns of waves. There are five waves in the direction of the trend and three waves against it. Recognizing these patterns can help you understand where the market might go next.
By identifying the current wave patterns, you can gauge whether the market is moving up or down and where it might head next. If you know where you are in the wave sequence, you can anticipate the next moves
Each wave has a specific role. For example, if you see the market completing a five-wave uptrend, you might expect a three-wave correction afterward.