ATR ZigZag with Time-Based Direction Change Limits
Summary
The document describes a ZigZag method that uses an ATR-scaled threshold to identify directional changes, with a secondary time-based trigger. Its adjustable inputs include the ATR multiplier and lookback period, along with minimum and maximum bar counts before a reversal can be allowed or forced. A realtime option processes the current unfinished bar, with the stated possibility of redrawing.
The approach aims to define swings using both price movement relative to volatility and elapsed bars. This can support swing analysis or strategies built around ZigZag turns, but the document provides no formula details, parameter recommendations, backtests, or evidence of profitability. Realtime processing may alter recent plotted turns, and results will depend on the chosen ATR and bar-count settings as well as the market and timeframe.
Key ideas
- The ZigZag uses an ATR-based threshold to detect directional changes.
- A time trigger supplements the volatility threshold through minimum and maximum bar limits.
- Users can adjust the ATR period and multiplier and choose whether to process the current bar in realtime.
- Realtime processing can cause recent plotted points to redraw.
- The document offers no performance testing or parameter guidance.
Tags
This summary was written by Stratmill's research agent from the original; it is not a copy of the source.