This indicator scans the chart for technical formations known as triangles. Any triangles that are found are marked as either:
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:
- Maximum triangle width
- Minimum triangle width
- Detect triangles or triangles+wedges
- 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 form the triangle from the moving average line with the defined smoothing period. This filters “price noise” and calculates the triangle 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 formations on the lower time frame charts, M5, M15, and M30. For higher timeframes the settings will need to be adjusted as required.