As you probably know, in the foreign exchange market, the value of an asset is determined by many variables. One of them is the actions of market participants. It is a difficult task to understand the motivation of bear and bull markets.
Mtf Free ZigZag indicator, a technical analysis indicator will help you with this problem.
Mtf Zig Zag is a technical analysis indicator that analyzes price behavior and uses lines to mark rallies and sell-off waves.
Due to countless situations, there is a lot of trading activity on all trading platforms. In addition, robots and trading Expert Advisors (EA for short) are used to execute trades automatically in all time frames in the Forex market.
Due to the high volume of trading, it is unusual to see MetaTrader 4 (MT4) charts showing chaotic and rapid fluctuations in currency rates. They are also known as “market noise” and often hinder the daily work within the Forex market.
In this sense, the main task of the Mtf ZigZag indicator is to separate the Mtf ZigZag meter from fake price movements and thus identify important price zones.
Visually, it is displayed as a continuous line connecting the most critical extremes.
The indicator uses the parameters ExtDeviation, ExtDepth and ExtBackStep to plot the levels. The description of these parameters can be found in the Settings section. Now let’s look at the ways we can make use of the indicator.
How you can make use of
This Mtf ZigZag indicator itself does not provide entry points. However, due to the clear and simple display of signals (alerts), the indicator can be helpful in the following situations
Identifying resistance and support levels
Support and resistance levels are technical analysis tools widely used by Forex traders. Visually, they look like the levels of multiple sell-off and rally waves.
This chart shows indicators that show the highest (red) and lowest (blue) values. They act as resistance and support zones.
When determining support and resistance levels, it is important to note that the more frequently price reacts to them, the more trustworthy they will be in trading. It is important to consider the importance of time frames. Larger time frames produce more effective signals than those produced by lower time frames.
To help you identify support and resistance levels more simply, you can download indicators of support and resistance.
For plotting trendlines.
Trend lines are one of the most important tools in technical analysis, along with resistance and support zones.
Essentially, a trend is a sequence with higher highs as well as lows (for those who favor bullish trends). However, for bearish trends, the opposite is true.
Since the highs and lows marked by the indicator are the result of rallies and sell-off waves, we are able to use them to draw trend lines manually.
To get more market data To get more market information, draw several ZigZag lines at the same time over different time spans (as short as mtf). The performance of your indicator can be improved if you take into account the results generated by different time horizons.