CM_OldSchool_Projected_high_Low

The CM_OldSchool_Projected_high_Low indicator calculates and plots projected high and low price levels for various timeframes to assist traders in identifying key support, resistance, and potential breakout zones.

Usage

The Usage section describes how the script can be used to identify market extremes and trend shifts across different time horizons. Traders typically use these levels in two primary ways:

• Support and Resistance: The projected high and low levels often act as floor and ceiling boundaries. Price reaching these levels may encounter exhaustion, leading to a reversal toward the mean.
• Breakout Identification: When the price breaches a projected level, it often signals a shift in momentum. To visualize this, the indicator features dynamic coloring:
  • Neutral: The levels remain a neutral color when the price is within the projected range.
  • Bullish Breakout: The projected high turns green (or the designated bullish color) when the price crosses above it.
  • Bearish Breakout: The projected low turns red (or the designated bearish color) when the price crosses below it.

For example, a swing trader might enable the Weekly and Monthly levels to find higher-timeframe confluence, while a long-term investor might use the Quarterly and Yearly levels on instruments like the SPY or EURUSD to gauge yearly price boundaries.

Details

The script is based on a formula developed by Owen Taylor, a former floor trader, and was later popularized by Larry Williams. The logic aims to predict the trading range of the upcoming period using the price action of the previous period.

The core calculation involves establishing a Pivot Factor (PF) based on the HLC3 (Average of High, Low, and Close):

1. Pivot Factor (PF): (High + Low + Close) / 3 * 2
2. Projected Low: PF - High of the previous period.
3. Projected High: PF - Low of the previous period.

By applying this formula to higher timeframes (Daily, Weekly, Monthly, Quarterly, and Yearly), the indicator provides a multi-layered view of market structure. The script utilizes security calls to fetch data from these higher timeframes, ensuring the levels are accurately projected regardless of the chart's current resolution.

Settings

The settings allow users to toggle specific timeframe projections on or off to maintain chart clarity:

• Show Daily Projected High Low?: Toggles the visibility of the next day's projected range.
• Show Weekly Projected High Low?: Toggles the visibility of the next week's projected range.
• Show Monthly Projected High Low?: Toggles the visibility of the next month's projected range.
• Show Quarterly Projected High Low?: Toggles the visibility of the next quarter's (3 months) projected range.
• Show Yearly Projected High Low?: Toggles the visibility of the next year's (12 months) projected range.

FAQ

Who developed the formula used in this indicator? The formula was originally created by floor trader Owen Taylor and was subsequently shared and utilized by renowned trader Larry Williams. This version was coded and adapted for modern platforms by ChrisMoody.

Can I use this indicator on intraday timeframes? Yes, the indicator is compatible with intraday charts. When used on lower timeframes, it will project the higher-level boundaries (such as Daily or Weekly) onto your current view.

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