S/R and Reversal Bars

The S/R and Reversal Bars indicator identifies potential price pivot points and dynamic support/resistance levels by combining Commodity Channel Index (CCI) readings with candlestick analysis.

Usage

The tool is primarily designed for identifying reversals and trading ranges. It uses specific CCI thresholds to mark significant market events directly on the price chart:

• Extreme Reversals: Triangles appear when the CCI reaches extreme levels (above 200 or below -200), signaling potential overextended conditions.
• Reversal Confirmation: Circles appear when the CCI crosses back from extreme levels (under 180 or over -180), suggesting a reversal is gaining momentum.
• Support & Resistance Levels: The indicator plots horizontal markers based on these CCI events. Support levels (green crosses) are established during bullish reversals, while resistance levels (red crosses) are established during bearish reversals.
• Secondary Zones: Smaller circles represent intermediate levels of interest based on the CCI crossing the +/- 70 and 0 (balance) thresholds.

This indicator is most effective in sideways or ranging markets where price oscillates between established boundaries. In trending markets, traders should look for breakouts or breakdowns of these levels for confirmation.

Details

The script utilizes a standard 20-period CCI calculation as its core engine. By tracking how price deviates from its statistical average, the tool identifies moments where the price action is likely to stall or pivot. Unlike a standard oscillator shown in a separate pane, this script translates those momentum shifts into price-level anchors. These levels remain static once a bar closes, though they may shift in real-time as the current bar's CCI value fluctuates before the close.

Settings

• Show S/R levels: Toggles the visibility of the horizontal support and resistance markers (crosses and circles) on the chart.

FAQ

How do I access S/R and Reversal Bars?

You can get access on the LuxAlgo Library for charting platforms like TradingView, MetaTrader (MT4/MT5), and NinjaTrader for free.

Why do the levels move during a live candle?

Because the indicator is based on the CCI of the current price, the readings will fluctuate until the candle closes. This provides early indications of potential setups.

Can this be used for scalping?

Yes, the indicator is effective for intraday scalping across various timeframes, as it highlights immediate supply and demand zones based on momentum extremes.