Zig Zag Indicator
An indicator that filters out price moves smaller than a set threshold, connecting only significant highs and lows with straight lines.
The Zig Zag Indicator filters out price moves smaller than a specified percentage or amount threshold, connecting only the significant highs and lows that remain with straight diagonal lines, specifically to simplify a chart's visual noise and highlight major swing points.
A key limitation worth understanding clearly: the Zig Zag Indicator repaints — its most recent line segment can and does change as new price data comes in, which means it can't be used in real time the same way it appears when looking back at historical data. See Kaavon's dedicated Zig Zag article for how this repainting behavior actually works.
Examples
- The Zig Zag Indicator's most recent segment can change entirely as new price data arrives, a behavior called repainting.
- Because of its repainting behavior, the Zig Zag Indicator is generally used for visually simplifying historical price structure, not for generating real-time trading signals.