# 4.56 The Three-Drive Pattern

The Three-Drives pattern has its origins in Elliotology and was referred by Robert Prechter in his famous book, “Elliott Wave Principle.”

The Three Drive pattern is really an offshoot of the wave structures that typified price movements and were detailed in the Wave Principle. It can be described in brief as a five-wave structure that follows the Fibonacci rules for projecting retracements and extensions within its formation.

Like the ABCD, this pattern too appears in a bearish or bullish mode.

## Bearish Three-Drives

The bearish pattern is a rising five-wave structure of which point A is a Fibonacci 61.8% retracement of leg (or, drive) 1. Thereafter, drive 2 is a 127.2% extension of the corrective move ending at A. Drive 2 also sees a corrective 61.8% retracement to point B. Drive 3 is the 127.2% extension of the corrective move ending at B

Traders gear up for the anticipated short trade when resistance comes up during the third drive, marking an end of that.

## Bullish Three-Drives

The bullish pattern is a falling five-wave structure of which point A is a Fibonacci 61.8% retracement of leg (or, drive) 1. Thereafter, drive 2 is a 127.2% extension of the corrective move ending at A. Drive 2 also sees a corrective 61.8% retracement to point B. Drive 3 is the 127.2% extension from point B, and is the recommended buying point.

Traders gear up for the anticipated long trade as soon as support is realized in the course of the third drive, marking the end of that drive.

## Variations of Three Drive pattern

Similar to the ABCD patterns, there are variations of the three drive patterns also. The retracement after the first and second drives can be78.6% and in that case the expected extensions after the first and second corrections from points A and B would be 161.8%.

The second variation would be when the retracements remain 61.8% but all the drives are of the same size and also the time spent by the price movement on all the drives is equal.

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