Know the target before the move gets crowded.

The core pattern is a five-wave impulse in the direction of the larger trend, followed by a three-wave correction. Each wave subdivides into smaller waves of the same pattern, which is why the theory is described as fractal. Wave Radar also marks Equal Wave projections to give corrections an objective reference target.

First, wave 2 never retraces more than 100 percent of wave 1. Second, wave 3 is never the shortest of the three motive waves. Third, wave 4 never overlaps the price territory of wave 1 in cash markets. If any rule is broken, the wave count is wrong and must be relabeled.

Standard Elliott notation labels a correction A-B-C, and Wave Radar adds O for the origin point where the correction begins. The O-A-B-C label therefore traces the full corrective sequence from its starting extreme through its three legs. Anchoring the origin makes it easier to measure retracement depth and project the Equal Wave target.

An Equal Wave target projects a correction by assuming its legs will have equal length, giving one objective price level to watch. It is a measurement framework, not a forecast: the market is under no obligation to respect it. Its value is in defining the scenario precisely enough that it can be proven wrong.

Fibonacci ratios such as 38.2, 50, and 61.8 percent are used to frame zones where a corrective wave might end. They describe proportional relationships between waves rather than causes of price movement. Treat them as areas of interest to investigate, not as lines the market must obey.

Invalidation is the specific price level at which the assumed wave count breaks one of its rules. For example, a research setup based on a completed correction is invalidated if price trades beyond the correction's origin. Knowing this level in advance is what turns a wave count into a testable research idea.