S1 Support and resistance

The S1 Support and resistance indicator helps traders identify dynamic supply and demand zones by calculating and visualizing multi-period market highs and lows. This tool is designed to highlight areas of price correction and resistance, providing a visual representation of market sentiment and potential trend shifts.

Usage

The indicator can be used to identify current market boundaries and potential reversal or breakout points. It visualizes these areas using colored zones:

• Support Zones: These appear at the bottom of the price action (typically green) and represent areas where buying pressure has historically entered the market.
• Resistance Zones: These appear at the top of the price action (typically red) and represent areas where selling pressure has dominated.

Traders can use these zones to determine who is currently dominating the market. A price approach to a blue (support) zone suggests a potential bullish correction or entry point, while a price approach to a black/red (resistance) zone suggests a potential bearish correction or exit point.

Details

The script functions by tracking the highest highs and lowest lows over two distinct lookback periods. By plotting these values, the indicator creates a "channel" or "zone" of support and resistance.

• Top Zones: Formed by comparing the current high against the highest high of the specified lookback windows.
• Bottom Zones: Formed by comparing the current low against the lowest low of the specified lookback windows.

The indicator uses the ta.valuewhen function to maintain levels until a new high or low is established, creating horizontal steps that represent significant price levels. It also includes built-in alert logic for when price crosses these significant support or resistance levels.

Settings

• Lookback 1: Defines the first period used to calculate the immediate support and resistance levels. A smaller value makes the indicator more reactive to recent price changes.
• Lookback 2: Defines the second period used to calculate broader support and resistance levels. This helps create the "zone" effect when combined with Lookback 1.

FAQ

How do I interpret the zones?

The zones represent areas where price discovery has historically stalled or reversed. Support zones suggest a floor where buyers are active, while resistance zones suggest a ceiling where sellers are active.

Does this provide exact entry signals?

The indicator shows the approximate support and resistance areas to help you determine market dominance. It is best used in conjunction with other technical analysis tools rather than as a standalone entry signal.

How can I access S1 Support and resistance?

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