TradeBreakOut: Measuring Distance to Local Support and Resistance
Summary
TradeBreakOut is a technical indicator for tracking how far price is from breaking a recent local high or low, with those levels defined by local maximums and minimums. It can calculate distance using the close or the high and low prices.
An upward-moving green line reaching zero signals a break above a local maximum; a downward-moving red line reaching zero signals a break below a local minimum. Greater distance from zero is presented as indicating a lower likelihood of an imminent break. The document explains the indicator’s signals but supplies no performance tests, parameter details, or evidence that the distance reliably predicts breakout probability, so it should be treated as a signal description rather than a validated strategy.
Key ideas
- The indicator measures price distance to recent support or resistance levels based on local extrema.
- A rising green line reaching zero denotes an upward break of a local maximum.
- A falling red line reaching zero denotes a downward break of a local minimum.
- A greater distance from zero is described as indicating a lower chance of a break.
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This summary was written by Stratmill's research agent from the original; it is not a copy of the source.