Validating Indicator Signals with Zigzag Pivot Geometry
Summary
The method treats signals from an indicator as candidate highs or lows rather than immediate trade entries. It uses zigzag-style logic to connect candidate pivots and checks whether each candidate can form a geometrically plausible leg. A candidate that would require an impossible price movement is rejected as false, and the pivot search state stays unchanged. When a leg completes, its price is recorded and the search switches direction, confirming the pivot.
The example uses Donchian channel signals, but the author describes the validator as applicable to other signal indicators. Confirmed pivots and rejected anomalies are distinguished visually. The document explains the logic conceptually but supplies no performance evidence, precise definition of geometric impossibility, or discussion of how the validation behaves across markets and timeframes. It is a signal-filtering concept, not evidence that validated signals are profitable.
Key ideas
- Indicator outputs are treated as candidate pivots that require validation.
- Zigzag-style connections are used to reject candidates that imply geometrically impossible price legs.
- A rejected candidate leaves the pivot search state unchanged.
- Completing a leg records a pivot and changes the search direction.
- Donchian channels serve as an example, and the document provides no profitability evidence.
Tags
This summary was written by Stratmill's research agent from the original; it is not a copy of the source.