For installation of Fractals on the graphic, we will press the button Indicators at a toolbar and we select from the appeared menu Bill Williams - Fractals
We won't change the settings.
Bill Williams's fractals - the first measurement of the market
Fractal on purchase – a series from five sequential bars in which before the highest maximum and behind it are two bars with lower maxima.
Fractal on sale – a series from five sequential bars in which before the lowest minimum and behind it are two bars with higher minimals.
Fractals on a purchase and on sale can consist of the same bars. Fractals give the following signals: if the fractal on a purchase is above Teeth of the Alligator (the red line),
the postponed warrant Buy Stop for opening of a line item should be laced on 1 pips above a maximum of a bar on which the fractal was formed;
if the fractal for sale is below Teeth of the Alligator,
the placed, postponed warrant Sell Stop on 1 pips is below a minimum of bar on which the fractal was formed.
If the fractal on purchase was formed below Teeth of the Alligator or a fractal on sale – above Teeth of the Alligator, such transaction needs to be passed not to feed the Alligator. Alligator,
Fractals will be active till the time of its destruction, or before appearance of a new fractal in the same direction (in this case the previous signal is cancelled, and the postponed warrant is removed). Very important is where was destroyed the fractal, i.e. on what bar it is necessary to enter into the market after overcoming of a fractal. If this bar is outside Teeth of the Alligator, such transaction is allowed.
Fractals are the first measurement of the financial market. Any input in the market begins with overcoming of a fractal. Only after the first fractal was overcome, we start accepting signals from another dimensions for opening of new line items in the direction of the first signal. Signals from future fractals in the direction of the first transaction which will also form the basis for opening of additional line items.