In order to solve the problem of end effect on ensemble empirical mode decomposition (EEMD), a new method based on extension of extreme wave in dealing with end effect is proposed. This method focuses on the template wavelet and the optimization starting point in waveform matching and extension.  The nearest extreme wave is used to the endpoint as the template wavelet, and the same type extreme point with the one nearest is taken to the endpoint as the optimization starting point. With this method, the purpose of optimization is clearer and the process is more optimized. In the meantime, an objective and effective evaluation method of end effect is provided, which is the end effect evaluating indicator in equal parts. It effectively avoids the interference of data length, and highlights the influence of end effect. Through the application of the method based on extension of extreme wave in the simulation signal and measured signal, and comparing with the result of the mirrored symmetry extension method, it is proved that the method base on extension of extreme wave can effectively restrain the end effect.