![]() ![]() While it can delineate key past price swings of securities, it cannot be used to forecast the next swing highs and swing lows. It is not predictive in any way - only based on hindsight. The Zig Zag indicator is good only for analyzing historical data to spot existing patterns and trends. It is a good trading indicator for any trader who follows indicators that use swing highs and swing lows. This helps to show the price waves that should be counted when performing the Elliot Wave Analysis. By determining the support and resistance areas, it helps to identify significant changes in price while filtering out short-term fluctuations. Since it can be used to identify support and resistance price levels in a market, the indicator is often employed with Elliott Wave Analysis to help identify the beginning and end of each wave. It helps in spotting price swing points which act as support and resistance areas, and thus, helps in filtering out irrelevant price swings or fluctuations that may constitute noise at best. The Zig Zag indicator is a basic tool that analysts use to analyze the price action of a security to spot trends and patterns. How the Zig Zag indicator appears on the chart. ![]()
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