AlgoWizard: Mapping price action patterns

Hi all. A number of strategies I’m looking to template in AW and evolve in the SQX ecosystem involve mapping out price action patterns. Specifically:

• bouncing off support and resistance levels, e.g. being able to know if the price is being rejected at a particular Fib retracement level
• multiple rejections at support and resistance levels over a period of time, e.g. enter on a rejection of price at a SMA if there’s been another rejection in the past X bars
• identifying higher highs, lower lows, higher lows and lower highs

My current plan involves first defining specific price action patterns. I think this should be pretty easy for highs and lows as there are specific functions for this built into AW. However, a price rejection could take many forms, e.g. a bar breaks a support level but then closes above vs two closes very slightly break a support level but the third bar closes above. Add into the mix that there are multiple Fib levels / PPs / SMAs that a bar could potentially be rejected at.

Once I’ve defined the patterns I’m then planning on experimenting with lots of shift based conditions within multiple fuzzy logic signals to ‘map’ sequences of those patterns in the price action that represent, for example a low, then a high, then the actual target; the higher low. I can already see this getting very complex very quickly.

Does anyone else do this currently? Am I missing something obvious or worse… attempting the impossible?

These are good points and ideas. Most of what you need should be possible using SQX. Also with the next update SQX b127 some of the issue with current version of built-in AlgoWizard will be fixed. You will also be able to define your own custom blocks that can consist of price action conditions, patterns and indicators

Thanks Tomas. Will definitely look out for 127. If anyone has any tips or recommendations about how they’ve approached this then I’d be very interested…