Innovative S/R Analysis Method
2024-10-06

Current S/R approach detects these levels on the spot by looking at swings, however although this is relevant it does not account for historical profile of that level this reduces credibility of the detection.
On the other hand, my approach involves analyzing the historical data rather than the action zone, with addition of volume perspective. The idea is that if we can find the total reversal volume of a level relative to all other levels, this might indicate how reactive the level is. So we calculate the total volume occured on pivots that originated from the level compared to all other levels.
Practical use case of the analysis is that if the price breaks a statistically high level including the error margin and on that direction following levels are not reactive, we can enter the trade at break point and exit at next big stop. This is applicable for all timeframes due to the extensive duration of the analysis, down to 1 minute.

I published an open source indicator that implements this logic:
