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What are Bill Williams Fractals?

Fractals are an indicator developed by Bill Williams. They are represented by triangles located at the top or bottom of the chart.

The principle for the construction of fractals is relatively simple. The price is created from a series of a few candlesticks (five, by default). A fractal forms at the top of the chart when the third candlestick is the tallest of the five (that is, it is taller than both the previous two candlesticks and the following two). A fractal forms at the bottom of the chart when the third candlestick is the shortest of the five (that is, it is shorter than both the previous two and the following two candlesticks).