Mastering Fractals: Your Guide to the Indicator on MetaTrader 5

In trading, one thing's for sure: price movements often stay pretty steady, with only brief periods of trend changes—about 15-30% of the time. The real money often comes during those times when market prices shift in a clear direction.

Enter the Fractal, one of the five key indicators from Bill Williams’ trading strategy. This nifty tool helps you spot the peaks and valleys in price action. Technically, an upward fractal consists of at least five consecutive bars, with the highest high in the center and two lower highs flanking it. Conversely, a downward fractal is identified by five consecutive bars featuring the lowest low in the middle, with two higher lows on either side. You’ll see these fractals marked on your charts with up and down arrows, indicating potential entry and exit points.

However, don’t just jump in at the first fractal signal you see. It's essential to filter these signals using the Alligator indicator. Here’s the scoop: avoid closing a buy position if the fractal is below the Alligator’s Teeth and steer clear of closing a sell position if the fractal sits above the Alligator’s Teeth. Once a fractal signal is in play and positioned beyond the Alligator’s Mouth, it remains valid until it’s challenged or a new fractal signal takes its place.

Fractals indicator

Mastering Fractals: Your Guide to the Indicator on MetaTrader 5

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