Description
The PZ AB=CD Retracement indicator is a technical analysis tool for MetaTrader 5 that identifies AB=CD retracement patterns on the chart. These patterns consist of a four-point price structure (A, B, C, and D), where the CD leg mirrors the AB leg in size and time. This formation is foundational to many harmonic trading strategies.
This indicator simplifies the identification of AB=CD patterns by automatically analyzing price action and displaying valid patterns directly on the chart. It helps traders pinpoint high-probability reversal zones and offers visual guidance with entry, stop-loss, and take-profit suggestions based on Fibonacci levels.
AB=CD patterns can expand during their formation, which causes potential repainting. To reduce false signals and make trading more reliable, this indicator uses a Donchian channel breakout as a confirmation before signaling a trade. Only when a breakout occurs in the expected direction after the D point is a signal triggered.
Bullish patterns are displayed in blue, and bearish patterns are shown in red. The indicator also includes a wide range of customization options for pattern size, ratio conditions, visual styling, and alert configuration.
Key Features
- Automatically identifies AB=CD retracement patterns on the chart
- Customizable pattern size and AC/BD ratio conditions
- Implements Donchian breakout confirmation to reduce false signals
- Displays entry, stop-loss, and take-profit levels based on CD Fibonacci projections
- Offers email, push, sound, and on-screen alerts for pattern formation and breakouts
- Helps traders learn and apply harmonic concepts to real market data
- Supports multiple simultaneous instances with different settings
- Non-repainting signals once breakout confirmation occurs
Technical Details
- The indicator is evaluated on every bar, not every tick
- The last point (D) may repaint as the pattern expands
- Several instances can be used on the same chart with different amplitudes
- Alerts are issued when the pattern is detected and when the breakout happens
- A small portion of signals may still repaint; increasing breakout period reduces this risk
Trading Notes
- Use the breakout signal to confirm the validity of a pattern
- Consider higher timeframes for more reliable signals
- Combine with trend filters or confluence zones for better accuracy
Input Parameters
- Amplitude – Size of the AB=CD patterns to be found.
- Breakout Period – Donchian breakout period used to time the trade signals.
- Max History Bars – Number of bars to look back when the indicator loads on the chart.
- Min AC – Minimum ratio allowed for the AC leg of the pattern.
- Max AC – Maximum ratio allowed for the AC leg of the pattern.
- Min BD – Minimum ratio allowed for the BD leg of the pattern.
- Max BD – Maximum ratio allowed for the BD leg of the pattern.
- AB = CD – Enable or disable strict AB = CD ratio condition.
- Display Options – Choose to show or hide labels, ratios, and SL/TP price levels on the chart.
- Patterns – Customize the colors and line widths of the pattern structure (AB, BC, CD legs).
- Labels – Set the colors and sizes of the A, B, C, D labels on the chart.
- Ratios and SL – Choose the colors and font size of the Fibonacci ratio and SL/TP labels.
- Alert on breakouts – Enable alerts when a Donchian breakout occurs after a valid pattern.
- Alert on patterns – Enable alerts when a valid AB=CD pattern forms.
- Alert settings – Enable or disable alert types: visual, push notifications, email, and sound alerts.
Disclaimer
This indicator is a tool for technical analysis only and is designed to assist in chart interpretation. It does not constitute financial advice, investment recommendation, or any guarantee of results. Trading involves a high risk of loss and can result in the loss of your entire capital. Use this indicator at your own risk and only with money you can afford to lose. For complete details, please read our Terms and Conditions.
