I would like to discuss a strategy Dancingphil spoke about casually but not many took notice, his zigzag repainting scalping strategy in his own words:
We all know that the ZigZag Indicator almost always repaints the newest line drawn. Often it will repaint or grow this new line by 500-1,000 micro-pips. Almost always it retraces from the point where the line first appears by 50-200 or more micro-pips.
Everyone seems to complain about this repainting issue. I see it is VERY profitable for scalping.
I very successfully MANUALLY trade the Zigzag Indicator, by setting a pending LIMIT order "a number" of pips from where the new line first forms - the number of pips away for the limit order price depends on volatility and TimeFrame used. Because almost all the Zigzag's new lines repaint (get longer from when first appearing), I set my TakeProfit assuming a minimum repaint level and based on volatility.
That is, depending volatility and TimeFrame, the pending limit order I set 50 - 200 micro-pips (5-20 of the 4 digit pips) away from where the line is first visible (mostly I am using the 1M and 5M TimeFrames). This pending limit order getting hit happens almost all the time, depending on how greedy I am for maximum pips profit. Some trade set-ups I miss because price did not retrace enough from where the line first appears. I cancel these pending orders when the line becomes set and an entirely new line has begun to form, or if too much time has passed.
In my MANUAL trading this system, I generally use a multi-purpose type Trade Manager EA to set the Breakeven+20 micro-pips when price hits the price of where the original line forms and begins to be repainted longer, and thereafter have it manage the trade with a 20 micro-pips trailing stop. Almost all repainted Zigzag lines repaint by more than 20 micro-pips!
Example 1: Assume EUR:USD forms a new line DOWN at the price 1.40000, in a relative quiet market I will set a SELLLIMIT order at 1.40050 .....in a more vigorous market I will set the SELLLIMIT order at 1.40200. I will have the multi-purpose Trade Manger EA I use in manual trading to set a Stop at BreakEven+20 micro-pips when price again hits 1.40000 and thereafter a trailing stop of 20 micro-pips.
Example 2: Exactly same as Example 1, but I set the trailing stop of 20 micro-pips to start from repainted 50-200 micro-pips from the first paint. That is, if I set the SELLLIMIT order at 1.40050, then the Breakeven+20 micro-pips is set at 1.40020 when price hits 1.40000 again and I set the 20 micro-pips trailing stop to begin from at 1.39950.
Manually trading this system gets me 100-200 micro-pips about 9 out of 10 times.The other 1 out of ten times were me being a coward, losing faith in the set-up and closing the trade for far too small a profit, and very occasionally a tiny loss.
Original post: ZigZag EA help needed: This makes money from repainted new lines. - Moving Average, MA - MQL4 and MetaTrader 4 - MQL4 programming forum (mql5.com)
Here is a personal trade on the minute chart after the first line appeared I went short:
let me work I'll come up with something. I need to get rid of those lines. I did this maximum high & low thing on the mobile. Must also work on PC, in a better way of course.
