Fibonacci Progression with Breaks

This trading indicator focuses on showcasing points where the price greatly diverges from a specified central level. By utilizing either a user-defined value or a calculation involving a 200-period Average True Range (ATR) multiplied by Fibonacci sequence values, this indicator efficiently pinpoints potential market reversal points, while also determining trends based on central level positions. The primary aim is to offer traders insight into changes and potential opportunities in market trends, making it optimal for various trading strategies.

Key Features of the Indicator

1. Flexible Settings for Personalized Trading

• Method: Choose between "Manual" or "Atr" to define how the deviation distance is calculated.
• Size: Set the deviation either in direct points when using "Manual" or as an ATR multiplier in the "Atr" method.
• Sequence Length: Limit the maximum number of significant deviations for controlled market analysis.

How to Trade with the Price Deviation Indicator?

The primary utility of this indicator lies in identifying potential reversal points by analyzing significant price deviations from the central level. Furthermore, traders can utilize it to identify trend directions, where an uptrend is identified if the central level surpasses its previous value, whereas a downtrend is observed if it is lower.

In an uptrend scenario, a checkmark is highlighted if the price deviates significantly upwards, utilizing the Fibonacci sequence as a multiplier. Conversely, in a downtrend, a cross is depicted when the price deviates downward. In such situations, the distance threshold integrates the subsequent value from the Fibonacci sequence to adapt to fluctuations.

Should the sequence length surpass the user-defined Sequence Length by significantly deviating from the central point, a break label emerges, revealing a new central level that aligns with the current closing price, resetting the Fibonacci multiplier to 1.

Additionally, the indicator highlights upper and lower extremities from the central level alongside the threshold distance. These extremities serve as pivotal support and resistance levels, crucial for informed trading decisions.

FAQ

Q: How can I access the Price Deviation Indicator?
A: You can get access on the LuxAlgo Library for charting platforms like TradingView, MetaTrader (MT4/MT5), and NinjaTrader for free.

This well-crafted tool not only assists traders in scrutinizing price deviations but also aids in recognizing potential points for breakthroughs or trend continuations, making it a robust companion for optimizing trading strategies across markets.