Elliott Wave Flat Corrections are one of the most common and misunderstood corrective patterns in wave theory. Unlike sharp zigzag corrections, flats unfold sideways, indicating a balance between buyers and sellers. They typically occur in wave 2 or wave B positions and often signal trend continuation after consolidation. Understanding flats is essential for Elliotticians aiming to distinguish between different correction types and avoid miscounts.

This article explores the structure, types, rules, and trading applications of Elliott Wave flat corrections.

What Is an Elliott Wave Flat Correction?

A flat correction is a 3-wave structure labelled A-B-C, where:

• Wave A is corrective
• Wave B retraces close to or beyond the start of Wave A
• Wave C completes near or slightly beyond Wave A’s end

The key characteristic of flats is that Wave B retraces a large portion (often 90% or more) of Wave A, and the entire structure appears sideways rather than steep or impulsive.

Structure of Flat Corrections

• Wave A: Usually a 3-wave move (zigzag or flat)
• Wave B: Retraces 90–110% of Wave A
• Wave C: Usually a 5-wave move that ends near or slightly past Wave A

Flat corrections follow a 3-3-5 structure:

• A = 3 waves
• B = 3 waves
• C = 5 waves

Types of Flat Corrections

1. Regular Flat

• Wave B retraces close to 100% of Wave A
• Wave C terminates slightly beyond Wave A
• Indicates mild consolidation

2. Expanded Flat (Most Common)

• Wave B exceeds the start of Wave A (105%–125%)
• Wave C extends strongly in the opposite direction (often 1.618 × Wave A)
• Suggests strong underlying trend that resumes forcefully after the correction

3. Running Flat (Rare)

• Wave B also exceeds Wave A
• Wave C fails to reach the end of Wave A
• Indicates an extremely strong trend that doesn’t allow a full retracement

Identifying Flat Corrections

Look for:

• A wide Wave B retracement (close to or beyond Wave A)
• Sideways movement in the overall structure
• Wave C that ends near or slightly beyond Wave A (except in running flats)
• MACD or momentum divergence between Waves A and C (in expanded flats)

How to Trade Flat Corrections

Trade Setup: End of Wave C

1. Identify the flat A-B-C structure forming in a known wave position (e.g. Wave 2 or B)
2. Wait for Wave C to terminate (often at a Fibonacci extension of Wave A)
3. Look for confirmation with:
   • Bullish/bearish engulfing candles
   • Divergence on MACD or RSI
   • Return above/below a key trendline or level
4. Enter trade in the direction of the larger trend
   • Stop-loss: Just beyond the end of Wave C
   • Target: Wave 3 or C of the next impulse

Trade Setup: Expanded Flat Breakout

1. After Wave B exceeds the start of A, anticipate an aggressive Wave C
2. Use 1.272 or 1.618 extensions of Wave A as target zones
3. Enter once Wave C shows exhaustion and reverses with momentum

Flat vs Zigzag Corrections

Feature	Flat Correction	Zigzag Correction
Structure	3-3-5	5-3-5
Direction	Sideways	Sharply directional
Wave B	Deep retracement	Shallow retracement
Common Occurrence	Wave 2, Wave B	Wave 2, Wave A

Flats are consolidation patterns, while zigzags represent sharper pullbacks.

Common Mistakes to Avoid

• Confusing flats with triangles or zigzags: Use wave count and symmetry to confirm.
• Entering too early: Wait for Wave C to complete and confirm reversal.
• Overlooking context: Flats usually appear in corrective phases, not during impulsive waves.

Conclusion

Elliott Wave flat corrections are essential for any serious wave trader. They represent periods of equilibrium before the trend resumes and are especially common in B waves and Wave 2. By learning to identify flat patterns—and distinguishing between regular, expanded, and running flats—traders gain a major edge in wave forecasting and trade timing.

To master the recognition and trading of flat corrections and other complex wave patterns, enrol in our structured Trading Courses at Traders MBA and learn how to analyse markets with precision, confidence, and Elliott Wave expertise.