Drawing ATR-Width Support and Resistance Zones from Price Swings

Summary

This ProRealTime indicator identifies historical swing highs and swing lows, then displays resistance and support levels as colored zones extending across the chart. Zone width is based on the Average True Range, allowing the displayed area around a pivot to scale with recent price movement. Optional labels can show a level's price, its distance from the current close, and the number of bars since it formed. Settings also allow users to choose which support and resistance levels to display and whether to extend the drawings.

The supplied script uses a 13-period ATR and searches prior bars for successive pivots. The description and code explain the visualization method, but provide no trading rules for acting on a zone, evidence of predictive value, or performance results. Swing levels are retrospective and can be sensitive to implementation choices, while an ATR-scaled zone only describes a range around a detected price level. The indicator is therefore a charting aid; the document does not establish that support or resistance zones will hold or produce profitable trades.

Key ideas

• The indicator finds swing highs and lows to define candidate resistance and support levels.
• It uses ATR to set the width of each plotted zone.
• Colored rectangles and horizontal lines extend levels across the chart, with optional labels and extension settings.
• The document describes a visualization technique but supplies no evidence that the zones predict price behavior.

Tags

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