Glossary
What is Invalidation level?
An invalidation level is where the setup or wave count fails; stops are often placed beyond it.
An invalidation level is the price where a trade thesis or wave count is considered wrong. Structure-based stops often sit just beyond that level.
Elliott examples: wave 2 cannot break the origin of wave 1; wave 4 cannot overlap wave 1 in a standard impulse. Breaking those levels invalidates the count.
On PipAlert, the Signal's stop loss should preferably match a clear invalidation—not a random round number. If it does not, size smaller or skip.
Related terms
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