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Ending Diagonal

By Smart Wave Analysis Research TeamUpdated How we analyzeAdvanced

An ending diagonal is a wedge-shaped pattern that appears in the wave 5 position of an impulse or the wave C position of a correction. All five of its waves subdivide into three waves, 3-3-3-3-3, and it signals that the larger move is close to its end.

Structure

An ending diagonal has five waves inside two converging trend lines, forming a wedge. Each of its waves is a three-wave move, so it subdivides 3-3-3-3-3. Wave 4 almost always overlaps wave 1. In a contracting ending diagonal, wave 3 is shorter than wave 1, and wave 5 is shorter than wave 3.

Ending diagonal diagram with converging lines, overlap and a throw over above the upper line
All five sub waves are threes (3-3-3-3-3). Wave 5 often throws over the upper line.

Where it appears

  • Wave 5 of an impulse, often after a wave 3 that moved too far, too fast.
  • Wave C of a zigzag or flat.

The throw-over

Wave 5 of an ending diagonal often pokes briefly beyond the upper trend line in an uptrend, or below the lower line in a downtrend. This is called a throw-over. It frequently comes with a spike in volume and is followed by a fast reversal.

Diagram showing a fast decline after an ending diagonal back to its starting point
The reversal after an ending diagonal is often quick and reaches the start of the pattern.

What happens next

After an ending diagonal, the market usually reverses sharply and returns at least to the starting point of the diagonal, often in a short time. This makes ending diagonals one of the most useful reversal signals in Elliott Wave analysis.

Diagram of an A B C correction where wave C forms an ending diagonal
A falling wedge in wave C often marks the end of the correction.

Trading tips

  • Avoid buying the final push of a rising wedge after a long rally.
  • Look for a break of the lower trend line to confirm the pattern is complete.
  • Use the start of the diagonal as a first target for the reversal.

Frequently asked questions

How does an ending diagonal subdivide?

All five waves are three-wave moves, so it subdivides 3-3-3-3-3.

What is a throw-over?

A brief move of wave 5 beyond the diagonal's trend line, often just before a sharp reversal.

How far does price fall after an ending diagonal?

It often returns at least to where the diagonal began, and usually quickly.

Sources and further reading

Educational content only. Nothing on this page is financial advice or a recommendation to buy or sell. Trading involves risk and you can lose money. Elliott Wave counts are probabilities, not certainties. Read our full disclaimer and affiliate disclosure.