Support/Resistance Formula

  1. 15 Posts.
    I want to determine a method to create support/resistance lines, which are based on the frequency with which a stock bounces above or below a particular price.The more times a stock bouces up away from a price, the stronger the support line, the more it bounces below a price, the stronger the resistance.

    How do I go about this? I can easily generate a frequency table (in cents - not always practical for stocks varying over a large price range), but how do I determine what prices, if any, are significant from my sample?

    Any help much appreciated, especially if you are statistically minded :)

    Cheers,

    JTek
 
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