Here is a step by step tutorial on how to do the arm wave.
#1 Have your arm in the straight position.
#2 Bend your wrist into position.
#3 Now continue the wave by bending the following joint.
#4 Then onto your wrist, make sure it's curved upwards.
#5 Then to your elbow, pay attention to your hand, it should be flat (just like it was in its original position). Be sure to let the elbow curve up more obviously to amplify the wave effect.
#6 Next, push your elbow back to its original position and lift your shoulder.
#7 Waving out should be a breeze once you've mastered waving in.
#8 Finally, it takes patience and time to learn, so never give up and you'll definitely come up with good results. It may be tough at first, so repeat the steps slowly until you get used to the motion, then try doing it at a faster pace.
With the arm wave broken down in this way, you should be able to master this move.