Zigzag Arrow Indicator for MT4

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Zigzag Arrow Indicator for MT4

Introduction to the Zigzag Arrow Indicator

Identifying swing highs and swing lows are one of the key skills that are required to effectively trade using price action or market flow concepts. This is because these points are key points which could indicate trend direction and potential reversal points.

The Zigzag Arrow Indicator is a tool which traders can use for the purpose of objectively identifying swing highs and swing lows.

What is the Zigzag Arrow Indicator?

The Zigzag Arrow Indicator is a technical indicator which identifies the swing highs and swing lows of price action.

It plots a blue arrow pointing up to indicate a swing low and a red arrow pointing down to indicate a swing high.

Zigzag Arrow Indicator for MT4

How the Zigzag Arrow Indicator Works?

The Zigzag Arrow Indicator uses an underlying Zigzag Indicator to identify its swing high and swing low points, hence the name “Zigzag Arrow”. The difference between the Zigzag Arrow Indicator and the classic Zigzag Indicator is that instead of connecting the swing high and swing low points to form a zigzag structure, the Zigzag Arrow Indicator plots arrows to indicate the swing highs and swing lows.

How to use the Zigzag Arrow Indicator for MT4

Since the Zigzag Arrow Indicator uses an underlying Zigzag Indicator to identify its swing highs and swing lows, its settings variables are the same as that of the Zigzag Indicator. This allows traders to tweak the sensitivity of the underlying Zigzag Indicator, effectively adjusting the sensitivity of the Zigzag Arrow Indicator signals.

“InpDepth”, “InpDeviation”, and “InpBackstep” are the variables that enable users to modify the sensitivity of the Zigzag Arrow Indicator.

This indicator also allows traders to change the color of the arrow it plots using the “Arrow Up” and “Arrow Down” options.

How the Zigzag Arrow Indicator Works

The Zigzag Arrow Indicator is an indicator that identifies swing highs and swing lows. As such, it is one of the best indicators to use when trying to identify trend direction based on swing highs and swing lows. Price action traders often identify trend direction based on a rising or falling swing high and swing low pattern.

Identifying Uptrend Markets Using the Zigzag Arrow Indicator

Price action trading defines an uptrend market as a market with consistently rising swing highs and swing lows. Using the Zigzag Arrow Indicator, we can identify an uptrend based on swing lows that are consistently higher than preceding swing lows and swing highs that are consistently higher than preceding swing highs.

How to use the Zigzag Arrow Indicator for MT4 - Buy Trade

Identifying Downtrend Markets Using the Zigzag Arrow Indicator

Inversely, price action trading defines a downtrend market as a market with consistently dropping swing highs and swing lows. Using the Zigzag Arrow Indicator, we can also identify downtrend markets based on swing highs that are consistently lower than preceding swing highs and swing lows that are consistently lower than preceding swing lows.

How to use the Zigzag Arrow Indicator for MT4 - Sell Trade

Conclusion

The Zigzag Arrow Indicator might seem like a short-term trend reversal signal indicator based on the arrows that it plots. However, swing highs and swing lows are often identified by the indicator on hindsight. The signals it produces can often be lagging.

It is best to use this indicator not as a signal indicator but rather as a means for objectively identifying swing highs and swing lows. These can be used for identifying trend direction based on price action, and as a basis for identifying horizontal support and resistance levels using swing highs and swing lows.

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