Volume-Normalized Support and Resistance Bands
Summary
This indicator locates candidate resistance and support from recent rolling highs and lows, then surrounds those levels with bands scaled by average true range and current volume relative to a rolling volume percentile. The fill becomes more prominent as relative volume rises. Separate thresholds place markers around support or resistance during high-volume conditions, and another threshold colors high-volume bars. The lookback length, thresholds, and colors are adjustable.
The script provides a visual way to compare price structure with relative trading activity and may help frame breakout or reversal hypotheses. Its evidence is the indicator’s calculation and display logic; the document reports no market tests, predictive accuracy, or trading results. The levels are mechanically derived from recent extremes, and volume is normalized against a finite historical window, so the display depends on the chosen settings and available volume data. The indicator alone does not establish whether a level will hold or break.
Key ideas
- Recent rolling highs and lows define candidate resistance and support levels.
- Band width scales with average true range and volume relative to a historical percentile.
- Fill intensity, markers, and bar colors emphasize periods that cross configurable volume thresholds.
- The indicator visualizes price structure and participation but provides no evidence of predictive performance.
- Users must interpret the displayed levels in context and account for sensitivity to settings and volume data.
Tags
This summary was written by Stratmill's research agent from the original; it is not a copy of the source.