Quasimodo Pattern indicator in TradingView - Free - [TF Lab]

The Quasimodo Pattern Indicator (Quasimodo) is part of a series of TradingView indicators that helps identify the QM pattern, one of the robust and reliable technical analysis patterns in the RTM style.

 Due to its structural resemblance to the character Quasimodo in Victor Hugo's novel "The Hunchback of Notre Dame," this pattern is named after him. This specific type of Head and Shoulders (H&SH) pattern assists traders in identifying Trend Reversal points.

Its difference from the Head and Shoulders pattern lies in creating CHOCH (Change of Character), which can increase its performance reliability.

Indicator Table

Overview

The Quasimodo Pattern Indicator signals a potential price trend reversal and can be used as confirmation at key chart points where a trend reversal is likely.

By identifying the QM pattern, this indicator specifies entry points and take-profit and stop-loss levels, enabling traders to enter trades accordingly.

QM Pattern in an Uptrend

The following image shows the price chart of USDJPY in a 1-minute timeframe. After a sustained uptrend, the left shoulder forms, and the price creates a new peak (head) higher than the left shoulder's peak. After the price drops toward the previous low, we witness a CHOCH (Change of Character) as it breaks the low, followed by a movement back up to reach a level equal to the left shoulder.

The QM pattern is complete, and a sell trade can be initiated.

Take-Profit and Stop-Loss for the QM Pattern

The indicator sets the area above the head (highest peak) as the stop-loss and the last low where CHOCH occurred as the take-profit.

Inverse QM Pattern in a Downtrend

The image below shows the price chart of USDCAD in a 1-minute timeframe. After a sustained downtrend, the left shoulder forms, and the price creates a new valley (head) lower than the left shoulder's valley.

After the price rises towards the previous high, we witness a CHOCH, and the price returns to a level equal to the left shoulder. The QM pattern is complete, and a buy trade can be initiated.

Take-Profit and Stop-Loss for the Inverse QM Pattern

The indicator sets the area below the head (lowest valley) as the stop loss and the last high where CHOCH occurred as the take profit.

Indicator Settings

• Pivot Period: The indicator's period is set to 5.

Summary

The Quasimodo Pattern, or QM, is a reliable technical analysis pattern frequently appearing on price charts.

This Price Action indicator identifies QM patterns without needing to examine the chart, and traders can use additional confirmations like trend direction, support and resistance levels, and supply and demand zones to trade.