Geometric signal validation for indicator signals - MetaTrader 5용 지표

It is known that many signal indicators produce false signals. Geometric signal validation is a means to remove these false signals in real-time and leave the other signals as they are. In geometric signal validation, a false signal is one which would produce a geometrically impossible zigzag leg. An indicator that would paint a buy signal when the market goes down has painted a geometrically invalid entry signal, and therefore you could respect that it is a false signal because of that. Geometrically invalid signals are essentially unsafe or false signals.

Knowing how many indicators are notorious for producing false signals, the signals that they immediately produce should not always be seen as entry signals, they should be seen as candidate signals.

In this engine, signals that an indicator produces (in this case Donchian channel lines) are the candidates for low and high pivots. They all need to be validated. Zigzag-based logic is used to connect each of the candidate signals that the indicator produced, and if one of the candidates produces a geometric impossibility, it is seen as a false signal and the pivot search state remains unchanged.

When a zigzag comes to mind, you are probably imagining an indicator with logic driving the zigzag, but the script is flipped here, as this is not a zigzag, it is a validator.

When a leg concludes its search, it records the price, and changes search state. This change of search state is also the confirmation of the pivot. Confirmed pivots are marked with arrows, and geometric anomalies (the false/dangerous signals) are marked with arrows and an X graphic striking through it.

The signal validation can be done on any signal indicators, the Donchian channel is used here for example purposes. To understand it more clearly, you can study the code which I commented, and also run it visually in the strategy tester.