The Zig Zag indicator is used to identify a trend by filtering the minor variations that are defined with a parameter. It represents significant trend reversals and allow to follow the evolution of a value.
The Zig Zag is calculated on the basis of a minimum gap defined in point or percentage. A trend emerges when the progression of the price is higher than the value of the minimum variance set.

Example

Interpretation
The Zig Zag clearly show trends of a value by ignoring minors movements below the minimum variation. It marks high points and low points of trends. This tool can be used in addition to the theory of Elliott wave because it clearly identifies the different waves of a bullish or bearish movement.
When several peaks of the curve Zig-Zag are at the same level of price, this level is an important support or resistance.