This indicator scans the chart for technical formations known as triangles and wedges. Any patterns that are found are marked as either:
You can set a filter to display any of the above pattern types on their own. The indicator can create an alert as soon as the price breaks the support/resistance lines of any detected pattern.
To a chartist, a triangle hints at a continuation of a trend rather than a reversal. Therefore, the detection of a these formations is useful in many situations.
The configuration of the indicator can be adjusted to find different types of pattern. The inputs are as follows:
- The pattern types to identify
- Maximum shape width
- Minimum shape width
- Alert on break of support or resistance
- Outlier percentage
Maximum and minimum width let you to define the scale of patterns which are to be detected from small to large. The indicator will use the moving average line as defined to detect the shape. This filters “price noise” and calculates the triangle/wedge position based on an “averaged price”.
Sensitivity will define how “uniform” the triangle can be. When this number is very low, the triangle must be more uniform in appearance – the price must fill more of the shape. This constraint is loosened, as the sensitivity setting is raised.
Outlier percentage constrains the variation of price across the formation. With a low percentage the price must remain within the shape, with a high percentage this constraint is relaxed.
The default settings are suitable for finding triangle and wedge patterns on most charts. The settings can be adjusted to detect longer or shorter patterns as required. See the user guide for more technical information.