Wave theory, specifically Elliott Wave Theory, is used in financial markets to analyze and predict price movements based on recurring patterns and investor behavior. This theory suggests that markets move in repetitive cycles of five impulsive waves in the direction of the trend and three corrective waves against it. These patterns reflect the collective psychology of investors, alternating between optimism and pessimism. The fractal nature of these waves means similar patterns can be observed at different scales, allowing analysts to predict future price movements based on historical data. In the cryptocurrency market, Elliott Wave Theory is applied to understand and anticipate the highly volatile price movements, providing traders with a framework to make informed decisions#bitcoin #altcoins #BTC #pepe