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Using MACD Range Differences to Identify Dynamic Support and Resistance

Article MQL5 code base
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Summary

This indicator extends standard MACD readings by measuring the gap between the MACD and signal lines and the change between the latest two MACD bars. The author interprets a rising or falling MACD bar as directional movement on the current timeframe, while an unchanged bar can mark a potential support or resistance level. The measured distances are used to estimate price levels associated with those signals.

The example describes separate levels derived from a flat pair of MACD bars and from the signal-to-MACD gap. These levels are dynamic: they apply within the current bar and timeframe, and reset when a new bar forms. The document presents an indicator concept and an illustrative calculation, not a validated trading strategy. It offers no backtest or evidence that the levels predict reversals reliably, and it advises combining the tool with other forms of analysis.

Key ideas

  • The indicator tracks both the MACD-to-signal gap and the distance between the latest two MACD bars.
  • A rising or falling MACD bar is treated as a directional cue for its timeframe.
  • A flat MACD bar may be used to derive a potential support or resistance level.
  • The calculated price levels reset when a new bar forms and are limited to the current timeframe.
  • The document provides no backtest validating the indicator's predictive value.

Tags

Technical indicatorsForexStatistics

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