Binned Price Levels for Support, Resistance, and Rejection Statistics

Summary

This indicator divides the close-price range over a rolling lookback into ten equal-width bins. It assigns historical closes to those ranges and uses each bin's average close as a candidate support or resistance level. The resulting levels are drawn across the chart, with optional labels or a table reporting the indicator's estimated support and resistance success rates. The author presents closely spaced levels as possible areas of price accumulation or consolidation.

The method considers closes throughout the range rather than relying only on swing highs, lows, or pivot points. Its rejection statistics count directional rejection events around each level, but the accompanying explanation describes a confirmation rule based on consecutive closes beyond a level. These rates are historical descriptions, not evidence of future reliability. The author also notes that average-based levels can be crossed before price rejects, large moves can skew the range, and a fixed lookback can miss relevant levels when price exceeds its recent extremes. No independent validation or strategy results are provided.

Key ideas

• The script divides the lookback's close-price range into ten equal bins and averages closes within each bin.
• Bin averages form support and resistance candidates that use price data across the range, not only extremes.
• Optional statistics estimate how often each level has acted as support or resistance based on rejection events.
• Closely spaced levels may indicate an area where price has consolidated, according to the author's interpretation.
• Average-based levels can be crossed before rejection and may be skewed by sharp moves or limited lookback data.

Tags

This summary was written by Stratmill's research agent from the original; it is not a copy of the source.