The Fractal Pattern Scanner provides the ability to predict the turning point in the financial market. In this article, we provide a practical guide on how to use the tipping point prediction provided for your day trading. Turning point forecasting consists of two types of forecasting. The first is the expectation of a trough. In the bottom forecast, we are trying to anticipate the possible bullish turning point during the price decline. The second is peak expectation. At the height of the forecast, we are trying to anticipate the possible bearish turning point while the price is rising. The tipping point forecast is useful because it tells the whole story of the price series. For example, it will provide you with visual guidance for price action + and it will also provide probability information. It is a true combination of statistical forecasting and technical analysis. As a trader, we can manage entry and exit by predicting the turning point. Another advantage is that probability gives us the opportunity for a second level of decision-making. This is actually the important part because many other technical indicators do not provide probability information, which we can use for a more advanced level of decision making. With the ability to read these probabilities, we can practically use these tipping point predictions to determine price action in the financial market. It is a good indicator of price action assuming you are not misusing the probability information.
Below is a breakdown of the price action with turning point forecast. We also provide a screenshot to explain each peak and trough case with some visual aid. As you can see from the screenshot, we can plot two price movements in succession for each peak and trough prediction.
When we expect to peak:
1. A potential bullish breakout trading opportunity in a low probability area
2. A potential bearish reversal trading opportunity in a high probability area
When we expect a trough:
1. A potential bearish breakout trading opportunity in a low probability area
2. A potential bullish reversal trading opportunity in a high probability area.
Guessing these price movements is likely to come naturally while forecasting the turning point. The screenshot below is for you to confirm your understanding. If the terms peak and trough are not familiar to you, google some physics articles that explain peak and trough in the wave cycle. We’re using the same term here because we don’t want to reinvent the wheel again. Once you understand the peak and trough cycle in those articles, it will be much easier to showcase the working elements of your trading with this article as well. In my opinion, forecasting is the turning point in its unique position between statistical forecasting and technical analysis. Perhaps we can consider it a combination of both worlds. We recommend that you enjoy this scientific advance for your trading.
For example, you can watch this video titled “Breakout Trading vs. Reversal Trading – Turning Support and Resistance into a Killer Strategy” to understand how to control market timing with this probability tool.
Below is the landing page for Fractal Pattern Scanner in MetaTrader version.