Looking at the Dow Jones Equity REIT Index I noticed a Bearish Wolfe Wave that developed throughout much of this year. As it reached point 5 (where one is to enter a short position with a target of the 1-4 line) it began to unfold as expected. However, price found support at the 1-3 line and turned around, morphing into a contrary wave (a bullish Wolfe Wave within this bearish Wolfe Wave). These contrary waves can develop as seen here, or even within two separate time frames intr-day.
Fortunately in this example you would have been able to exit with a profit or at break-even. But it is a good example in monitoring the health of these patterns throughout their cycle, especially around the 1-3 line where price can find support (2-4 line resistance in a bullish wave) when making a move to their target line.
Fortunately in this example you would have been able to exit with a profit or at break-even. But it is a good example in monitoring the health of these patterns throughout their cycle, especially around the 1-3 line where price can find support (2-4 line resistance in a bullish wave) when making a move to their target line.
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