set-ups like Swing or Trend Following strategies. Quite often, newcomers tend to be totally amazed by it, believing that with it, they cannot go wrong. In reality however, nothing could be further from the truth, mainly because it does something called “repainting”. In other words, during a live progression of price action changes, the indicator changes the most recent Top or Bottom in order to reflect the new price data. By the time the ZigZag Top or Bottom has settled in and establish itself on the indicator, the current situation of the market has long changed and is no longer congruent with the point that was initially indicated as being a Top or a Bottom of the prices.
Thank you for reading this post, don't forget to subscribe!This, however, does not mean that this indicator is worthless! On the contrary, it can be used quite effectively for analysing past data and creating very good setups for many a strategy – just not in the way most newcomers believe it to be. Now, there are many ways that this indicator is used effectively, and I invite commenters here, to share their ideas about how to effectively use it in their strategies, but that is however, not the main objective of this article.
I set out to take the original ZigZag code by Metaquotes, and to rewrite it in a more easily readable form (at least for me), but most importantly, to visually display many of its internal workings which usually are not visible with the original indicator (see images below). Here is the list of the “extra features” which my rendition of this indicator, namely “ZigZagZug” will display for you:
- Lines graphs are displayed showing the Highest Highs and Lowest Lows for the “Depth” period, one of parameters of the original indicator.
- Besides the current and finalised Top and Bottom points used in the ZigZag pattern, it also displays the past points that were considered as strong candidates that at a point were considered a valid Top or Bottom for the ZigZag pattern. These are displayed as little fully filled circles at Highs (“●”) and Lows (“●”).
- Optionally, the indicator can also display all BreakOut points, breaking above Highs (“○”) or below Lows (“○”) of the “Depth” period, that were also considered as potential tops and bottoms in the internal workings of the ZigZag indicator. It is usually these that are most often “repainted” as current prices evolve and that newcomers erroneously consider as a valid current top or bottom with disastrous results for their egos and account balance.
The main purpose of the code and the extra visual cues, serves the purpose, of not only better understanding the workings of this indicator, but also as possible signals that could be used in many a strategy that you may wish. They could be useful for quick scalping in Breakouts or as pre-signals prior to retracements or others which have not even occurred to me yet. I am sure that many of you will come up with many ideas and hopefully will be willing to share them here with all that read this.
MT4 Indicators – Download Instructions
[post-title] is a Metatrader 4 (MT4) indicator and the essence of the forex indicator is to transform the accumulated history data.
[post-title] provides for an opportunity to detect various peculiarities and patterns in price dynamics which are invisible to the naked eye.
Based on this information, traders can assume further price movement and adjust their strategy accordingly.
How to install [post-title].mq4?
- Download [post-title].mq4
- Copy [post-title].mq4 to your Metatrader Directory / experts / indicators /
- Start or restart your Metatrader Client
- Select Chart and Timeframe where you want to test your indicator
- Search “Custom Indicators” in your Navigator mostly left in your Metatrader Client
- Right click on [post-title].mq4
- Attach to a chart
- Modify settings or press ok
- Indicator [post-title].mq4 is available on your Chart
How to remove [post-title].mq4 from your Metatrader 4 Chart?
- Select the Chart where is the Indicator running in your Metatrader Client
- Right click into the Chart
- “Indicators list”
- Select the Indicator and delete
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