You may rarely use a trading tool called Andrews Pitchfork trading strategies. In the MetaTrader 4 platform, this trading tool is not found in the indicator set. Maybe that’s one reason if traders rarely use Andrews Pitchfork.
Well in this article we will look for answers about Andrews Pitchfork strategies, how it works, how it works, and so on. At least it adds to our insight. Which there are many trading tools that have been designed by experts and become tools that can be applied in trading activities.
Work from home CFD, forex trading online with TenkoFX
TenkoFX broker regulated by IFSC Belize
- 1 What is Andrews pitchfork in forex?
- 2 How to draw Andrews pitchfork in MT4
- 3 Does Andrews’s pitchfork work?
- 4 Andrews pitchfork rules
- 5 Andrews pitchfork indicator mt4
- 6 Andrews pitchfork thinkorswim
- 7 How to use Andrews pitchfork in trading
- 8 Andrews pitchfork vs Schiff pitchfork
- 9 Final Thought
What is Andrews pitchfork in forex?
Citing to Investopedia, The Andrews Pitchfork trading tool designed by Dr. Alan Andrews consists of three parallel lines, which of these lines can function as support and resistance levels. By using the support and resistance levels of the Andrews Pitchfork trading tool, this can be a breakout or breakdown signal.
In Metatrader 4, the Andrews Pitchfork display is as shown below.
The top line of this trading tool is generally easy to guess, it is the resistance line of the recent price. While the bottom line represents the support level, and the middle line is called the median line, which serves to predict the reversal point of the trend.
Andrews Pitchfork includes channel indicators, such as trend line, equidistant, linear regression, standard deviation, gann grid, etc.
How to draw Andrews pitchfork in MT4
To draw Andrews Pitchfork maybe the first time you try it quite confusing you. It is a little tricky. To be able to do it right requires trial and error so you really understand how to draw points 1, 2, and 3.
Finding high low on the trend
To start drawing the Andrews Pitchfork first you find the highs and lows of the candlestick pattern to determine the support and resistance levels.
Start finding where the initial trend started to form, like point 1, then find point 2 as the high of the trend, point 3 is the low formed after the price bounced.
The next step is to click the “Insert” menu in the top bar of the Metatrader 4 platform, then scroll down and find Andrew Pitchfork.
Click then drag onto the chart where you will draw the Andrews Pitchfork.
How to start draw a line
Andrews Pitchfork consists of three-point lines, to pin these three points you have to triple-click on your chart.
But the steps do not immediately click three times at one point, first click on point 1 where a trend begins to form. It will leave the first line on the chart, continue clicking once at point 2, it is the high of the trend, it will leave the second line on the chart. Finally, click once on point 3, which is the low of the trend.
Then the three lines will appear as channel lines that can be used as trading references.
In the example image above the line at point 1 is the median line, this is the starting point for drawing the indicator line. While points 2 and point 3 act as resistance and support to the price trend.
How to set up Andrews pitchfork
Andrews Pitchfork is included in the channel indicator group, in general, its function is the same as the trend line. However, this indicator with its three lines in managing it uses the ABC rules.
The median point becomes point A or points 1, as the starting point of a trend. While point B or point 2 depends on the current trend. In the example above, point B is high because of the bullish trend. However, on the bearish trend, point B lies at the low. Only then point C or point 3 lies at the high for the bearish trend.
You may need to trial and error few times to get an accurate setting.
Does Andrews’s pitchfork work?
Maybe you’ve heard of the repainting indicator. It is an indicator that redraws when a trend changes. Therefore, if you look at the history of the indicator line, it looks perfect to give a signal.
Andrews Pitchfork is not a repaint indicator, after drawing on the chart, it won’t change even if the trend changes direction.
Therefore, after drawing Andrew Pitchfork on the chart, in the future, you may find that this indicator is not accurate. Sometimes the price breaks out of the line.
According to Dr. Alan Andrews who became the inventor of this indicator based on the concept that prices often return.
Andrews Pitchfork assumes that 80% of the market time will be used as a market trend. So the assumption is that 80% of the market always forms a trend. Here you will make the price drawn using a guideline according to market conditions, it can go up (up-trend) or fall (down-trend).
Andrews pitchfork rules
After understanding how to draw Andrews Pitchfork on the Metatrader 4 platform, next is how to trade according to the Andrews Pitchfork trading strategy rules.
Maybe the thing you need to remember is how to draw Andrews pitchfork on the bullish by finding lows-high-lows, and for bearish by finding high-lows.
Trading rules using Andrew Pitchfork are divided into two ways, Andrew Pitchfork inside range and breakout.
Andrews Pitchfork rules inside the range
As previously explained, the two top and bottom lines from Andrews Pitchfork act as support and resistance levels. Meanwhile, the price may cross the median line and bounce off the upper and lower lines.
Andrews Pitchfork’s inside range trading rules are as follows:
- The Buy rule is that when the price bounces off the bottom line of the Andrews Pitchfork indicator, place a stop loss below the support level of the lower line. Profit target when the price reaches the median line.
- The sell rule is that when the price bounces off the indicator’s top line, place a stop loss above the upper line as resistance and target it when the price reaches the median line.
- In a bullish trend, buy the median line and target the top line with the stop loss below the median line level.
- In a bearish trend, Sell at the median line and target at the bottom line, and stop-loss above the median line.
- If there is a condition where the price breaks the median line and moves against the trend, then hold the trade as it may be a trend reversal. Or if the price succeeds there is a breakout above or below Andrew’s Pitchfork line because the indicator may be invalid.
Andrews Pitchfork rules breakout trading
Trading rules Andrews Pitchfork breakout system refers to a break of the upper line of the indicator on a bearish trend and the bottom line of the indicator on a bullish trend.
- If the indicator’s illustration is pointing bullish, then wait when the price breaks the median line from top to bottom, if the price continues down and there is a breakout at the bottom line of the indicator, wait for confirmation.
- The price may return within the range of the indicator as a false breakout, so wait for the price to bounce off and retest the lower line area of the indicator which became the resistance level because there was a previous break.
- If the price returns to the bottom and fails to break the resistance level, then open Sell and place a stop loss above the bottom line.
Andrews pitchfork indicator mt4
Metatrader 4 already supports the Andrews Pitchfork indicator, you don’t need to look for it in third parties. However, to be able to master this way of drawing manually requires time and thoroughness with experience.
But if you want to buy third-party indicators, you can find them on the MQL5 market. But it costs money to get it, even at $ 68. Besides the indicators, there is also an expert advisor that allows you to make automatic trades with Andrews Pitchfork’s trading strategy.
Andrews pitchfork indicator free download
Actually, you no longer need to look for a free download indicator for Andrews Pitchfork, as it is readily available on the Mt4 trading platform.
And I also did not find a download link for this indicator on the MQL 5 market, there only found one related to Andrews Pitchfork, dynamic Andrews Pitchfork, but priced at $ 68. Please check MQL5 if you are interested.
But on other sources, 4xone.com you can download the Andrews Pitchfork trading system for free. It’s just that it doesn’t purely use Andrews Pitchfork, but with a combination of several indicators. It might be a little tricky, with the crosshairs across the chart like the one below.
If likely you have interested to use Andrews Pitchfork’s free download below is the download link.
Andrews pitchfork thinkorswim
Andrews Pitchfork although maybe not all traders use it, this indicator is also available on the Thinkorswim platform.
This indicator is similar to a pitchfork, so the inventor gave it the name Andrews Pitchfork because it was Dr. Alan Andrew who discovered it.
Thinkorswim is a trading platform from Ameritrade which is a USA-based broker. You can find and learn how to use this indicator on the Thinkorswim help center here.
How to use Andrews pitchfork in trading
When using the Andrews Pitchfork indicator in forex trading, what matters most is how to draw it correctly.
Point ABC must be in accordance with the trend. Find the starting point of the trend and find the troughs and valleys as a reference in drawing the point ABC.
When you have drawn this pitchfork indicator, next is to wait for the price to be in the median line and resistance support which is represented by the deviation line of this indicator.
If the trend tends to be bullish, it is better to wait for a Buy signal than forced to sell even though the price is at the resistance level. Because the counter-trend tends to be a higher risk instead of the following trend.
Conversely, if the trend is bearish, focus on finding sell signals instead of buy because the risk is higher.
The picture above is the USDJPY pair, which tends to be a bullish trend in the market. After drawing the pitchfork indicator, the next step is to wait for the price action when it falls on the median line.
It is in this zone that the entry is Buy by looking at the confirmation signal from the candlestick pattern.
For stop loss by placing below the reversal candlestick or below the median line, adjust according to the planned risk.
Andrews pitchfork vs Schiff pitchfork
Maybe you have never known about the Schiff Pitchfork indicator, this indicator may rarely be used by beginners, so this indicator is less popular among MetaTrader 4 users.
The Schiff Pitchfork indicator is actually a development of the standard pitchfork introduced by Dr. Alan Andrews.
The story behind the Schiff Pitchfork indicator is when Jerome Schiff comes to Dr. Alan Andrews and then gives the response that prices are often shallow up or downtrend. So he came up with the idea to add a line with a distance of 1/2 of the vertical line.
This variation was later called the Schiff Pitchfork after Jerome Schiff was the originator of the idea.
How does Schiff Pitchfork look like?
If the standard pitchfork consists of only three lines, in contrast to the Schiff Pitchfork which consists of four lines. Where the other two lines are additionally calculated as 1/2 of the vertical line on the standard pitchfork.
Below is an example of a chart image embedding a Schiff Pitchfork taken from Tradingview.
Notice the image above, that the Schiff pitchfork, provides a wider support and resistance area than the standard pitchfork.
This allows traders to concentrate when the price crosses the standard pitchfork lines and the behavior of the Schiff pitchfork outlines.
Andrews Pitchfork strategies may be rarely used by forex traders, especially beginners. However, it is one of the channel indicators which can be useful for your trading analysis.
However, this indicator may also have its own imperfections. Therefore risk management when implementing the Andrews pitchfork trading strategy is very important as it prevents large losses in one trade.
You can also combine it with other indicators as a filter, for example, RSI or Stochastic.
Read more article