Description:
Gap Proximity is a technical indicator that measures how close the current price is to historical price gaps. This tool helps traders identify potential areas of support or resistance that may occur near these gaps, as gaps can often act as psychological barriers or targets in market movements.
Input Parameters:
- Gap Factor: The larger the value, the fewer gaps will be detected.
- Band Type: Preset to ATR, allows you to measure how far the price is currently from the most recent gap using ATR, St.Dev., Constant, or Percentage.
- Band Length: the number of periods used to calculate the band type.
- Band Mult: The multiplier used to calculate the band type.
Use Cases:
- Identifying Support and Resistance: Utilize the indicator to pinpoint potential support or resistance levels near historical gaps, which might influence future price actions.
- Entry and Exit Points: Traders can use the proximity to gaps to refine entry or exit strategies, considering gaps as targets or turnaround points.
- Enhanced Market Analysis: Combine Gap Proximity with other indicators to get a comprehensive view of market conditions and potential price movement catalysts.
This feature can be used in:
- Market Scanner
- Strategy Tester
- Multi-Factor Alerts
- Smart Checklist
Do you want to learn more? Check out our blogpost.
May 13, 2024