Both are W-X-Y structures, but their roles differ fundamentally. Double zigzag: price-correcting (Y extends beyond W). Double three: time-correcting (Y does not significantly extend beyond W). Whether Y exceeds W is the critical distinction.
Description
Double zigzag and double three look superficially similar — both consist of W, X, and Y components. However, their roles and price behavior differ fundamentally. The double zigzag is a price correction that extends price further (Y beyond W); the double three is a time correction that keeps price roughly in the same range (Y approximately at W’s level). The most important question: does wave Y significantly exceed the end of wave W?
Key Points
- Double zigzag (sharp compound): both W and Y are zigzags; Y significantly extends beyond W — new price extreme made
- Double three (sideways combination): W and Y are different wave forms; Y does NOT significantly extend beyond W — price stays roughly in the same range
- Critical test: does Y exceed W’s end? Yes → double zigzag. No → double three
- X wave retracement condition: if Y slightly exceeds W in a combination, the X wave must have retraced nearly 100% of W
- If Y fails to exceed W in what was counted as a double zigzag → the count is wrong (consider combination)
- Typical double three example (Figure 2-80): flat + zigzag + triangle — price sideways throughout
- Exit signal: if you counted a double zigzag but Y cannot exceed W → invalidated; look for combination or different count
