Metatrader Indicator (MT4/MT5)
The PZ Fibonacci indicator is a technical analysis tool that automatically draws fibonacci retracements or extensions on price charts. It is designed to be easy to use and eliminates the need for manual object anchoring, making it a useful tool for price confluence studies. The indicator selects two different price points and uses them to calculate the fibonacci levels, which are then plotted on the chart automatically. The indicator can adapt to the size and zoom of the chart, allowing you to get a broad overview of the market or delve into a specific timeframe. Once the fibonacci levels are drawn, you can also manually edit the anchors.
Fibonacci retracements and extensions are technical analysis tools that use horizontal lines to indicate areas of potential support and resistance in an asset's price movement. Fibonacci retracements are used to identify potential levels where the price of an asset may experience support or resistance after a price movement, while fibonacci extensions are used to identify potential levels where the price of an asset may extend to after a price movement. These levels are based on the fibonacci sequence, which is a series of numbers in which each number is the sum of the two preceding numbers (1, 1, 2, 3, 5, 8, 13, 21, etc.).
To interpret fibonacci retracements and extensions, traders typically look for price action around the levels to see if the asset is likely to continue in its current trend or reverse. If the price of an asset respects a fibonacci level, it may be an indication that the level is acting as a support or resistance. Conversely, if the price of an asset breaks through a fibonacci level, it may be an indication that the level is not acting as a significant support or resistance and that the asset's price may continue to move in the direction of the breakout.
When loading the expert to any chart, you will be presented with a set of options as input parameters. Don't despair if you think they are too many, because parameters are grouped into self-explanatory blocks.
- Indicator Settings
- Edit the size of the small fibo object and the behavior of the indicator.
- Drawing Settings
- Choose line widths for each type of price line.
- Does the indicator repaint?
- Once the fibonacci objects are drawn, it will not repaint for a while. But as new bars appear and close in the chart, old bars are pushed out of the chart to the left, and eventually, the fibonacci objects will redraw using the latest price data.
- If I zoom in or out, the fibonacci objects change!
- Correct, the big fibonacci object tries to encompass the maximum price range visible in the chart. The small one however, draws using only the last price leg.
- Does it draw retracements or extensions?
- It draws whatever is needed at the time, according to the current price and the price leg used to anchor the fibonacci object.
- Does the indicator implement alerts?
- No, it does not.