Pivot Based Trailing Maxima & Minima

If you're looking to enhance your trading strategy by identifying key support and resistance levels, this trading indicator is an excellent choice. By returning trailing maximums/minimums and their resulting averages, which reset on the occurrence of pivot point highs and lows, traders can get a clear view of the market's historical and current potential price reversals. This allows traders to easily spot past and present support and resistance levels, thus improving their trading decisions.

One of the standout features of this indicator is the ability to toggle backpainting, which shifts the indicator's output to past data, offering flexibility depending on your trading needs. This feature can be particularly useful for traders who want to refine their strategies by testing them against historical data.

How to Trade with This Trading Indicator?

Non Backpainting

Using the indicator without backpainting, traders can easily highlight crucial support and resistance points determined by the trailing maximum/minimum average. An uptrend in the market is signified when the trailing maximum consistently makes new higher highs. Conversely, a downtrend is indicated when the trailing minimum continuously makes new lower lows. This visual identification is particularly useful for traders to quickly identify trend directions and adjust their strategies accordingly.

Backpainting for Historical Analysis

When you enable backpainting, the historical trailing maximums/minimums and their averages are shifted to the past, making it easier to analyze market trends over time. Fortunately, these are extended up to the most recent bar, allowing traders to still use the indicator in real-time applications.

This feature allows traders to back-test and analyze past trends with precision. For example, if the trailing maximums/minimums fail to create new higher highs or lower lows, this suggests a ranging market. Additionally, observing how frequently new highs or lows are made can provide insights into the strength of bullish or bearish trends.

Customizing Your Indicator Settings

• Length: This setting allows you to determine the pivot high/low lookback. Increasing the length helps in identifying longer-term tops and bottoms, which is crucial for traders looking to capture larger price movements.
• Backpaint: This setting determines whether the indicator's results are subject to backpainting. By enabling backpainting, the results will be offset into the past, allowing for a historical perspective on market trends.

FAQ

How can I access this trading indicator?

You can get access on the LuxAlgo Library for charting platforms like TradingView, MetaTrader (MT4/MT5), and NinjaTrader for free. This gives traders the flexibility to incorporate this versatile indicator into their preferred trading platform, enhancing their ability to analyze and react to market conditions effectively.

Whether you're a novice trader looking to understand market dynamics or an experienced one aiming to refine your strategy, this indicator provides the tools you need to achieve your trading goals efficiently.