Introduction to the Pattern Alert v1.1 Indicator
Candlestick patterns are often used by price action traders as a means to open trades. However, not all traders have the skill to identify such candlestick patterns correctly or objectively.
The Pattern Alert v1.1 indicator is a tool that new traders can use to help them objectively identify possible reversal candlestick patterns.
What is the Pattern Alert v1.1 Indicator?
The Pattern Alert v1.1 indicator is a custom technical indicator which provides trade signals based on candlestick patterns. It identifies common candlestick patterns and labels it on the price chart. It also plots a small arrow pointing the direction of the reversal signal along with the label.
How the Pattern Alert v1.1 Indicator Works?
Different candlestick patterns have different characteristic descriptions. For example, the Bullish Engulfing pattern is characterized as a candlestick in which the body of the current candle is larger than that of the preceding candle. This description can be identified and programmed algorithmically as a candle that has a close price higher than the open price of the prior candle. The Pattern Alert v1.1 indicator would automatically identify and label this pattern based on its underlying algorithm. The same concept of converting the characteristic description into an algorithm is done for all the other patterns included allowing the indicator to automatically identify patterns.
How to use the Pattern Alert v1.1 Indicator for MT4
The Pattern Alert v1.1 indicator allows traders to modify which type of candlestick patterns would be identified and labeled on the price chart. These modifications can be done within the indicator settings.
The candlestick patterns identified by the Pattern Alert v1.1 indicator can be used as an entry signal or a basis for a trade setup. However, although descriptively valid not all patterns identified would characteristically look like the standard patterns. As such, it is best that traders would still visually confirm if the pattern being traded does look like a valid reversal pattern.
It is also best to use these patterns as signals and should be in confluence with other technical indications such as trend direction or a reversal from a support or resistance level.
Buy Trade Setup
When to Enter?
Observe a bullish trade setup. Open a buy order as soon as the Pattern Alert v1.1 indicator identifies a bullish candlestick pattern. Set the stop loss below the pattern.
When to Exit?
Close the trade as soon as price action shows signs of reversal.
Sell Trade Setup
When to Enter?
Observe a bearish trade setup. Open a sell order as soon as the Pattern Alert v1.1 indicator identifies a bearish candlestick pattern. Set the stop loss above the pattern.
When to Exit?
Close the trade as soon as price action shows signs of reversal.
Conclusion
Candlestick patterns can be effective trade entry signals as long as it is in confluence with a bigger picture trade setup or trend direction. The Pattern Alert v1.1 indicator can be a very useful tool for identifying such candlestick patterns and trade entries.
MT4 Indicators – Download Instructions
Pattern Alert v1.1 Indicator for MT4 is a Metatrader 4 (MT4) indicator and the essence of this technical indicator is to transform the accumulated history data.
Pattern Alert v1.1 Indicator for MT4 provides for an opportunity to detect various peculiarities and patterns in price dynamics which are invisible to the naked eye.
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How to install Pattern Alert v1.1 Indicator for MT4.mq4?
- Download Pattern Alert v1.1 Indicator for MT4.mq4
- Copy Pattern Alert v1.1 Indicator for MT4.mq4 to your Metatrader Directory / experts / indicators /
- Start or restart your Metatrader 4 Client
- Select Chart and Timeframe where you want to test your MT4 indicators
- Search “Custom Indicators” in your Navigator mostly left in your Metatrader 4 Client
- Right click on Pattern Alert v1.1 Indicator for MT4.mq4
- Attach to a chart
- Modify settings or press ok
- Indicator Pattern Alert v1.1 Indicator for MT4.mq4 is available on your Chart
How to remove Pattern Alert v1.1 Indicator for MT4.mq4 from your Metatrader Chart?
- Select the Chart where is the Indicator running in your Metatrader 4 Client
- Right click into the Chart
- “Indicators list”
- Select the Indicator and delete
Pattern Alert v1.1 Indicator for MT4 (Free Download)
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