Repaints Combining ZigZag with Anchored VWAP

[StoneMan]

Has anyone ever tried adding anchored VWAPs to the ZigZag high and low points?

 

[BenTen]

Has anyone ever tried adding anchored VWAPs to the ZigZag high and low points?

ZigZag is a repainting indicator. How do you see it being useful when adding to Anchored VWAP?

 

[StoneMan]

@BenTen My theory is that an anchored VWAP attached to either a swing high or swing low point will only be useful once you have determined that point is the apex of a trend. Once you know that you can go back, set the VWAP anchor, and let it calculate. If you wanted you could have the line formatting change from dashed to solid when the AVWAP turns from looking back to reacting to live data. Just to let the trader know what they would be seeing if they were looking in real time. This would automate a process that is normally done manually. Which would be nice. You could also mess with logic like highest and lowest swing high and swing low points on the chart. Not sure if this is the right post for this suggestion. Maybe it should be its own.

 

[MerryDay]

@BenTen My theory is that an anchored VWAP attached to either a swing high or swing low point will only be useful once you have determined that point is the apex of a trend. Once you know that you can go back, set the VWAP anchor, and let it calculate. If you wanted you could have the line formatting change from dashed to solid when the AVWAP turns from looking back to reacting to live data. Just to let the trader know what they would be seeing if they were looking in real time. This would automate a process that is normally done manually. Which would be nice. You could also mess with logic like highest and lowest swing high and swing low points on the chart. Not sure if this is the right post for this suggestion. Maybe it should be its own.

Your idea is sound BUT...

an anchored VWAP attached to either a swing high or swing low point will only be useful once you have determined that point is the apex of a trend.

therein lies the problem.

The apex of a trend is NEVER known for certainty, especially in today's volatile bear market.
We have seen the zigzag form a final low, go on to form a high AND THEN wipe them both out as it plummets to a new low.

There is no Holy Grail. We do not have an indicator that can predict with accuracy the beginning or the end of a trend that doesn't repaint or doesn't have significant lag.

My own hubris in believing I could do what no chartist had done before; led me down the same road you are traveling. Mine was a humbling failure.

Safe travels.

 

[StoneMan]

Thank you for the reply @MerryDay. I know every indicator has it's weaknesses. And for this repainting would work just fine. I tried to account for that with when a VWAP line would turn from dashed to solid. I did some digging and found something very close to what I was looking for.

https://usethinkscript.com/threads/anchored-vwap-indicator-for-thinkorswim.171/post-121866

Nothing truly new under the sun.

But I like the way Zig-Zag allows you to define trends based off of percentage moves. A fun and objective way to define what percentage qualifies a trend could be to create a metric based off of the instruments implied volitility. More volitile instruments need larger percentage based swings to qualify as a trend.

 

[StoneMan]

I appreciate your warning @MerryDay. The truth is I have already tried and been humbled in my own quest for a holy grail. It's not possible. But I still love playing with charts and data. It's more of hobby now then something I do seriously trying to make money off of. For the serious stuff I purchased the ConvexValue platform for unrestricted access to all options data. I have a lot to learn but mastering the dynamics of forced hedging is something I truly see as an edge. Of course execution and knowledge are two completely different things. You can know everything about basketball but you will never be Michael Jordan. Some of my recent posts reflect those lessons that I hope can save others time and sanity. Even the scanner I posted, while novel and cool, is useless without further analysis. Alone it's just a fun toy. For my personal view on charts you can check out this post I left on in the futures.io forums.

https://futures.io/psychology-money-management/59540-indicators-waste-time-2.html#post882147