The first wave in an Elliot sequence is wave 1.Later on when we want to calculate a Fibonacci Extension calculation,remember,this is the area at which we will start our calculation.we start our Fib Exe at the beginning of a new Elliott Wave Sequence.
Wave 2 is always related to Wave 1…

The most common retracements we look for in a typical Wave 2 pullback are either a 50% or 62% retracement of wave 1…
While we are on the subject of Wave 2′s,here are a some statistical information behind wave 2′s.
We typically expect only 12% of wave 2′s to hold 38% retracement of wave 1….

We anticipate 73% of Wave 2 retracements between 50% to 60%….

We anticipate 15% of Wave 2′s to retrace below the 62%….

once we have seen evidence of Wave 2 holding,we can use the Fibnacci Extension to calculate some wave 3targets.
Wave 3 is related to wave 1.Typing we monitor for the following Fibnacci relationships:
Wave 3=
either 1.62xlength of wave 1
or 2.62xlength of wave 1
or 4.25xlength of wave 1
The most common multiples of wave 1 to wave 3 are the 1.62 and 2.62 numbers.(if Wave 3 is extending , we typically monitor for 4.25 or higher ratios.)