This is a non-parametric zigzag with multiple modes of operation.
- The edges go up until they meet a bar whose maximum (high) is below the highest minimum (low), and the edges go down until they meet a bar whose minimum (low) is above the lowest maximum (high);
- Gann reversals: the edge goes up while high and low rise at each subsequent bar; the edge goes down while high and low fall at each subsequent bar; the inner bars (with lower high and higher low) and the outer bars (with higher high and lower low) do not affect the change of the edge;
- Weiss waves: bars with an increasing closing price form an edge up; bars with a decreasing closing price form an edge down;
- Changing the direction by correcting the price by a specified % or using an adaptive algorithm;
In addition to the zigzag itself (displayed in orange), the indicator displays signal labels on those bars where the zigzag changes direction. The blue up arrow means that a new up edge has been started (but it is not yet completed), while the red down arrow means that a down edge is being formed (also not yet completed). Tags can be used as trading signals.
Parameters
- Mode – one of the modes: High below Low/Low above High, Gann swing, Close vs Close (Weis wave), Retracement;
- ProcessTicks – the option to calculate on each tick is disabled by default (false); with this setting, the last unfinished edge is not displayed; if the option is set to true, the last unfinished edge is displayed, but it can change its position in accordance with price changes;
- RetracementPercent – the size of the rollback as a percentage of the price ( % ), which will change the direction of the zigzag (only for the Retracement and Close vs Close modes); 0 by default means a special auto-adaptive adjustment (see below);
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- Mode – one of the modes: High below Low/Low above High, Gann swing, Close vs Close (Weis wave), Retracement;
- ProcessTicks – the option to calculate on each tick is disabled by default (false); with this setting, the last unfinished edge is not displayed; if the option is set to true, the last unfinished edge is displayed, but it can change its position in accordance with price changes;
- RetracementPercent – the size of the rollback as a percentage of the price ( % ), which will change the direction of the zigzag (only for the Retracement and Close vs Close modes); 0 by default means a special auto-adaptive adjustment (see below);
ATTENTION. Like other zigzags, this indicator can redraw the last unfinished edge (if tick processing is enabled). That’s how it should be, it’s a feature. All previous edges and up/down labels are stable.
ATTENTION. Like other zigzags, this indicator can redraw the last unfinished edge (if tick processing is enabled). That’s how it should be, it’s a feature. All previous edges and up/down labels are stable.
WARNING. In the 1st mode, the extremes may not always coincide with the most prominent bars. This happens if a higher high price or a lower low price occurs on a bar that already belongs to the next edge forming in the opposite direction. For example, if the down arrow is shown on bar A, it means that a down edge is formed to the right of A, where only low prices are searched for as extremes. The high price extremum should remain to the left of the A bar. As a result, if the higher price of high is between bar A and the next lower extremum, this high cannot be marked as the zigzag extremum (since the section here goes down). This behavior is correct, it fully corresponds to the 1st algorithm and provides stability (vertices do not”jump”). The explanation is given in one of the screenshots.
The adaptive correction level is calculated using the formula:
Retracement = LastExtreme ± |LastEdge| / sqrt(N 1),
where N is the number of bars between the last LastExtreme extremum and the current bar. On the current bar, N = 0, so the rollback size is 1, i.e. the entire size of the LastEdge edge. At the distance of one bar, the size is 0.71, 3 bars-0.5, 8 bars-1/3 of the price change on the previous edge.
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