About Zig Zag technical indicator and about using it in the analysis of Eliot Waves - technical analysis of Fibonacci numbers. The Zig Zag indicator is a trend following indicator that is used in technical analysis to predict when an analyzed security's momentum will reverse.
The Zig Zag appears on a chart as a series of trend lines that connect significant peaks resistance points and bottoms support points. This indicator is developed to filter out price fluctuations smaller trends and show only significant trends and trend changes. Zig Zag has a minimum price change parameter, which determines the percentage or number of points that the price must move in order to draw a new trend line. In this way, this indicator eliminates those trends that are smaller than the value of the minimum price change selected.
The Zig Zag indicator is considered very useful in technical analysis. It is used to determine price trends, resistance and support areas, classic chart patterns like head and shoulders, double tops and double bottoms. At the same time, this indicator is widely used to reveal Elliot Waves and various trends' figures with the goal of determining a security's position in the overall wave cycle.
Since Zig Zag is a lagging indicator, which draws a trend line only after a change in trend direction has occurred, it is difficult to use it to predict a trend reversal. Still, the predictive power comes from using Zig Zag in the analysis of Elliott Waves, Fibonacci retracements and projections. By Victor Kalitowski for MarketVolume. Zig Zag Zig Zag is a technical indicator consisting of the trend lines connecting resistance and support points where trend lines are bigger than a selected minimum.
Zig Zag is a technical indicator consisting of the trend lines connecting resistance and support points where trend lines are bigger than a selected minimum. Zig Zag charts are used in technical analysis to see the main trends by elimminating smaller ones. Free Zig Zag Charts. Copyright - Highlight Investments Group. This material may not be published, broadcast, rewritten, or redistributed.
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