XPonts signal indicator: entry on price highs and lows
The main task XPointers indicator is to look for reversal candles on the chart, which will help you enter at the very beginning of the incipient trend. A similar task has been attempted before, but no Grails have yet been written.
So, the XPonts indicator is a dynamic channel that follows the price movement, as well as signal arrows to buy (blue) and sell (red).
The basis of the XPonts indicator is a fairly simple mathematical formula:
rate = (High - Low) / MathAbs (Close - Open)
In this case, if the rate is greater than 1, and Low or High touched the boundaries of the channel, then the corresponding trade signal is given.
Parameters of the XPonts signal indicator
The XPonts indicator has a lot of parameters:
- per - channel construction period;
- xrate - minimum ratio;
- xsize - minimum height bar (High-Low);
- xslope - the minimum increment of the next bar;
- xminupdn - the minimum thickness of the canal;
- xhour1 - hour from which the indicator signals are allowed (inclusive);
- xhour2 - hour up to which the indicator signals are allowed (inclusive);
- xindent - indicator arrow indent from the signal bar.
To understand how the indicator works, let's decipher the parameters.
The higher the build period, the wider the channel. The greater the xrate, the more accurate signals, and therefore fewer false signals. It is important not to make it too big, you should choose the optimal parameters for the instrument. The xsize parameter is needed for the signal calculation formula - how much of the active bar should be taken into account for the signal formation. Parameters xslope and xminupdn are needed for the same function - false signal filtering.
According to ForTrader.org experts, XPointers indicator - not a bad attempt at a signal filter, but it requires a lot of work to set the parameters for timeframe and asset. With the default settings it looked good only on the EUR/USD minute charts.