SuperZigZag: Defining Significant Moves and Extremum Updates
Summary
The document describes a ZigZag indicator that draws rays to identify movements large enough to count as significant. It offers two ways to define that threshold. In point-based mode, a user-set point value determines significance. In range-based mode, the indicator uses the high-low range across a specified number of bars, multiplied by a coefficient, to set the required move.
It also describes how the indicator updates its turning points. After an upward ray appears, the low extremum of the preceding downward ray is held fixed, while the high extremum of the upward ray may continue to update. This is presented as a non-redrawing behavior for the prior low, though the current high can still change as the move develops. The document gives no parameter defaults, market examples, performance tests, or details about how thresholds affect the timing and frequency of detected swings.
Key ideas
- The indicator draws rays to mark price moves that exceed a chosen significance threshold.
- One mode defines significance with a fixed number of points.
- Another mode scales a recent bar-range measure by a user-specified coefficient.
- Once an upward ray appears, the preceding downward ray's low extremum remains fixed while the upward high can update.
Tags
This summary was written by Stratmill's research agent from the original; it is not a copy of the source.