Benefit of using Lux Algo
- Members of the Luxalgo community get lifetime updates for free.
- It allows for flexibility as users can create their trading strategies.
- You can get access to support every time during the week.
- There are many technical indicators available for both professionals and beginners.
- Luxalgo provides educational content for its community.
- The discord server is filled with community members that are always ready to assist and share trading ideas.
- The tools come with instructions that make it easy for users to utilize them efficiently.
- Luxalgo uses robots that have been programmed to monitor markets, detect trends, detect patterns and send trade signals in line with users' strategies.
Chart patterns are a part of the foundation ofand are one of the most popular methodologies used by traders to predict future price variations.
Chart patterns are governed by precise identification guidelines and it is important to effectively recognize the presence of a specific pattern. Since this recognition process can be subjective, we designed a robust and efficient algorithm for the detection of traditional chart patterns, saving users valuable time.
In this post, we describe how to effectively use the Automatic Pattern Detection inside our main toolkit, Lux Algo Premium.
Using The Pattern Detection Feature
The Automatic Pattern Detection can be enabled within the Lux Algo Premium toolkit directly from SR Mode.
When enabled, a new cell on the dashboard will appear showing the current detected pattern. When no patterns are detected the dashboard will indicate the absence of a pattern and dashed lines will be displayed that can be used as.
The Pattern Detection feature at the time of this publication can detect the most commonly traded chart patterns, including:
- Ascending/Descending/Symmetrical Triangles
- Head And Shoulders
- Double Tops/Bottom
Note that the Pattern Detection algorithm depends on the current SR significance selected. Higher SR significance aims to return longer-term pattern structures.
Below are some examples of detected chart patterns using the Automatic Pattern Detection.
Head & Shoulders
Inverted Head & Shoulders
Once you have noticed a promising detected pattern, it is important to look at various other factors to gain confidence on its validity, as well as having a good plan in order to trade it.
You can see if an ongoing pattern requires your attention by looking at indicators or possible patterns on lower/higher timeframes and checking if this information lines up with the ongoing pattern as well.
Certain patterns require certaintrends in order to asses their validity. Some require down-trending , others require up-trending , and some require significant during a breakout.
It is possible to set take profits and stop losses when trading chart patterns using measure rules. Measure rules are describe by Bulkowski for several patterns.
We have an ongoing series about classical and more exotic patterns that you can read in order to understand them at a deeper level with education on identification rules, measure rule, and causes: