Automatic Chart Patterns from Recursive Zigzag Pivots

Summary

This indicator applies fixed rules to identify channels, wedges, and triangles from price swings. It builds a recursive zigzag at multiple scales, takes the latest five pivots at each scanned level, and fits two boundary lines through alternating pivot groups. A candidate is retained when the lines contain candle closes on the expected side and touch price on fewer than a configurable share of bars. The direction and relative movement of the lines determine the pattern label. The document describes thirteen pattern types and controls for pivot length, scan levels, line validation, pattern filters, and chart display.

The indicator can provide a consistent chart-reading reference, highlight potential boundaries for breakouts, and support screening by pattern family. These are proposed uses, not demonstrated results: the document gives no performance study or trading rules for acting on signals. Its zigzag marks the current extreme before the swing is confirmed, so the newest pivot and pattern can change while the bar forms; older patterns are described as stable. Pattern labels therefore require judgment and independent validation.

Key ideas

• The indicator scans groups of five recursive zigzag pivots to propose chart patterns.
• It fits two boundary lines and rejects candidates that fail its price-envelopment rules.
• Line direction and convergence classify patterns as channels, wedges, or triangles.
• Parameters control scan scale, validation strictness, pattern filters, and chart display.
• The newest pattern is provisional because its underlying pivot can move before confirmation.
• The document describes possible uses but supplies no evidence of trading performance.

Tags

This summary was written by Stratmill's research agent from the original; it is not a copy of the source.