Wolfe Wave
A five-wave price structure where the fifth wave overshoots a channel, signalling a sharp snap-back to the 1-4 trendline.
The Wolfe Wave, developed by Bill Wolfe, is a naturally occurring pattern of five waves that forms inside a wedge. Points 1, 2, 3, 4, and 5 define the structure; the EPA line (drawn from point 1 through point 4) projects the target after the reversal at point 5.
The trade triggers at point 5 when price overshoots the wedge boundary. The target is the EPA line (1–4 extended), typically reached quickly. Both bullish and bearish Wolfe Waves exist.
- Points 1 and 2 define the origin channel; point 3 must be higher (bullish) or lower (bearish) than point 1.
- The 1-3-5 trendline and the 2-4 trendline must converge.
Related Terms
Elliott Wave Theory
A fractal model of market cycles: price moves in five waves with the trend and three corrective waves against it, repeating at every time frame.
AdvancedFalling Wedge
Two converging downward-sloping trendlines where the upper line falls faster — a bullish pattern indicating downside momentum is fading.
IntermediateImpulse Wave
A five-sub-wave structure (1-2-3-4-5) that moves in the direction of the larger Elliott Wave trend — the core engine of directional moves.
AdvancedRising Wedge
Two converging upward-sloping trendlines where the lower line rises faster — a bearish pattern signalling that upside momentum is exhausting.
Intermediate