GFG MACD Pivot Lines by Agaam

The GFG MACD Pivot Lines indicator by Agaam identifies support and resistance levels by detecting turning points in MACD momentum rather than standard price action alone. This tool provides a unique perspective on market structure by projecting horizontal price levels from candles where MACD pivots are confirmed.

Usage

The Usage section describes how the script can be used to identify potential reaction zones based on momentum shifts. Users can utilize the green support lines to identify areas where bullish momentum previously initiated, potentially acting as entry points or bounce zones. Conversely, red resistance lines highlight where bearish momentum began, serving as potential rejection areas or targets for short positions.

The script allows users to customize the source of the pivot detection. For example, using the MACD Histogram may result in more frequent, sensitive pivots, while using the MACD Line or Signal Line often yields more significant, long-term structural levels.

Details

The indicator functions by monitoring a chosen MACD source (Histogram, Line, or Signal) for pivot highs and lows based on a user-defined "Left" and "Right" bar confirmation period. Because these are confirmed pivots, the script waits for a specified number of bars (Right Bars) to close before identifying the turning point. Once confirmed, the script draws a horizontal line starting from the historical pivot candle and extends it forward.

Bullish pivots are marked when the MACD source forms a trough, and bearish pivots are marked when it forms a peak. Users can also apply zero-line filters to ensure only "oversold" bullish pivots (below zero) or "overbought" bearish pivots (above zero) are displayed.

Settings

MACD Settings

• Source: The price data source used to calculate the MACD.
• MACD Fast/Slow/Signal Length: Standard parameters for the MACD calculation.
• MACD Pivot Source: Determines which part of the MACD (Histogram, Line, or Signal Line) is used to detect pivots.
• Pivot Left/Right Bars: The number of bars required before and after a point to confirm it as a pivot.

MACD Filters

• Bull Pivot Only Below Zero: When enabled, only bullish pivots occurring while the MACD source is negative will be drawn.
• Bear Pivot Only Above Zero: When enabled, only bearish pivots occurring while the MACD source is positive will be drawn.

Price Level

• Price Level From: Determines if the horizontal line is drawn at the candle's Wick (High/Low) or Close.
• Show Bull/Bear MACD Pivot Lines: Toggles the visibility of the respective levels.
• Show Current Pivot Only Per Side: If enabled, only the most recent line for each side is displayed.
• Extend Lines Right: Sets the length of the projected horizontal lines.

Visuals

• Colors (Bull/Bear/Label): Customizes the aesthetic appearance of the lines and labels.
• Line Width/Style: Adjusts the thickness and pattern (Solid, Dashed, Dotted) of the pivot lines.
• Show Labels: Toggles price labels at the end of the pivot lines.
• Label Offset/Size: Adjusts the position and scale of the price labels.

FAQ

How do I interpret the lag in line appearance? MACD pivots require a "Right Bars" confirmation period to ensure the turning point is valid. The line will appear on the chart only after the confirmation bars have closed, but it will be anchored to the historical candle where the pivot actually occurred.

Can I change which part of the MACD determines the levels? Yes, you can toggle between the MACD Histogram, the MACD Line, or the Signal Line in the "MACD Pivot Source" dropdown menu within the settings.

How do I access this indicator? You can get access on the LuxAlgo Library for charting platforms like TradingView, MetaTrader (MT4/MT5), and NinjaTrader for free.