The 3 Level ZZ Semafor forex indicator for Metatrader 4 is a sort of zigzag indicator.
It looks for high and low prices in the trend and then marks them with 1 (short-term), 2 (medium-term) or 3 (long-term).
Number 3 is the most important Semafor level to keep an eye on.
This indicator can’t be used as a standalone. Instead, use it together with a trend following indicator such as an exponential moving average with a period set at 75 or 100.
Trade in the direction of the underlying trend.
The default ZZ Semafor period settings (5, 13, 34) can be changed from the indicator’s inputs tab.
Feel free to experiment with its settings.
Free Download
Download the “3-level-zz-semafor.mq4” MT4 indicator
Indicator Chart (GBP/USD H1)
The GBP/USD Hourly chart below displays the 3 Level ZZ Semafor Metatrader 4 Forex indicator in action.
Basic Trading Signals
Signals from the 3 Level ZZ Semafor MT4 forex indicator are easy to interpret and go as follows:
Buy Signal: Open buy trade position when the underlying trend is up and the 3 Level ZZ Semafor indicator paints number 3 below the candlestick (support).
Sell Signal: Open sell trade position when the underlying trend is down and the 3 Level ZZ Semafor indicator paints number 3 above the candlestick (resistance).
Trade Exit: Use your own method of trade exit.
3 Level ZZ Semafor + Xmaster Formula Forex Scalping Strategy
This MT4 scalping strategy combines the precision of the 3 Level ZZ Semafor Indicator with the trend confirmation of the Xmaster Formula Indicator.
The goal is to catch fast and high probability moves on the M1 and M5 charts.
The Semafor plots three levels of reversal points. The number 3 signals the strongest potential turning point.
Xmaster Formula provides a clear trend direction by printing yellow up arrows during bullish momentum and yellow down arrows during bearish momentum.
This combination works well because Semafor identifies extreme swing exhaustion while Xmaster Formula filters entries in the direction of fresh trend pressure.
Buy Entry Rules
- Wait for the Semafor to print a number 3 under the candlestick.
- Wait for the Xmaster Formula to show a yellow up arrow confirming upward momentum.
- Enter a buy trade once the candle closes above both signals.
- Stop loss is placed 5 to 10 pips below the Semafor level 3.
- The take profit target is 10 to 20 pips on M1 and 20 to 35 pips on M5.
Sell Entry Rules
- Wait for the Semafor to print a number 3 above the candlestick.
- Wait for the Xmaster Formula to show a yellow down arrow confirming downward momentum.
- Enter a sell trade once the candle closes below both signals.
- Stop loss is placed 5 to 10 pips above the Semafor level 3.
- The take profit target is 10 to 20 pips on M1 and 20 to 35 pips on M5.
Advantages
- The combination filters out many bad reversal signals because both indicators must agree before entering a trade.
- Semafor highlights strong exhaustion points while Xmaster Formula confirms the trend direction, creating high probability setups.
- Perfect for fast trading on M1 and M5 charts where quick confirmation is essential.
- Signals are easy to read which helps traders avoid hesitation during fast market movements.
- The strategy adapts well to volatile pairs and active sessions where short bursts of momentum often occur.
Drawbacks
- The Semafor can repaint on lower time frames which requires patience and waiting for candle closes.
- False signals may appear during quiet market hours when the trend lacks strength.
Case Study 1
On EURUSD M1 during the London Open, the Semafor printed a number 3 below a strong bullish candle.
Two candles later, the Xmaster Formula confirmed the move with a yellow up arrow.
A buy entry was taken at 1.08940.
Price quickly accelerated upward and reached 1.08960 within one minute for a clean 20 pip gain.
The stop loss was safely below the Semafor level and never came close to being hit.
Case Study 2
On GBPJPY M5 during the New York session, the Semafor printed a number 3 above a rejection candle at a known resistance area.
Shortly after, the Xmaster Formula printed a yellow down arrow confirming the bearish momentum.
A sell entry was taken at 199.850.
Price continued dropping with strong momentum and reached 199.480 for a total of 37 pips.
The trade remained controlled throughout the move and reached the target without any retracement pressure.
Strategy Tips
- Focus only on clear number 3 signals because they mark the strongest reversal zones.
- Always wait for the yellow arrow from Xmaster Formula to avoid premature entries.
- Use this method mainly during London and New York sessions for stronger momentum.
- Stick to major pairs like EURUSD, GBPUSD, USDJPY and volatile cross pairs only when spreads are acceptable.
- On M1 charts, aim for quick profits and avoid holding for long swings.
- On M5 charts, look for slightly larger moves with tighter filtering and cleaner market structure.
- Consider trailing your stop loss once price moves at least 10 pips in your favor.
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Download the “3-level-zz-semafor.mq4” Metatrader 4 indicator
MT4 Indicator Characteristics
Currency pairs: Any
Platform: Metatrader 4
Type: Chart pattern indicator
Customization options: Variable (Period 1, Period 2, Period 3, Dev Step 1, Dev Step 2, Dev Step 3) Colors, width & Style.
Time frames: 1-Minute, 5-Minutes, 15-Minutes, 30-Minutes, 1-Hour, 4-Hours, 1-Day, 1-Week, 1-Month
Type: Support | Resistance Points
