Find Best Support and Resistance Levels with Tradingview Indicators
Identifying key support and resistance levels is critical for determining optimal entry and exit points. Tradingview offers several robust indicators to pinpoint support and resistance zones on any chart. In this guide, we’ll overview the top support and resistance indicators on Tradingview and how to use them in your trading.
Key Takeaways:
- Support/resistance shows where supply and demand reach equilibrium
- Tradingview offers robust indicators to identify key levels
- Supertrend highlights support/resistance zones on trendlines
- Volume Profile uses volume data to plot support/resistance shelves
- Trade bounces off support and breakouts through resistance
- Use higher timeframes and combine indicators for reliability
- Levels offer probability, not certainty – use proper risk management
Why are support and resistance levels so important?
Support and resistance represent key price levels where demand and supply reach equilibrium. This tends to stop price movement temporarily and cause bounces or breakouts.
Knowing where support and resistance lies allows traders to plan entries near bounces and exits near breakouts. This gives traders an edge in determining favorable risk/reward trade setups.
Strong support/resistance also indicates important price milestones to watch for breakouts, breakdowns and reversals. Mastering support and resistance technical analysis is vital for technical traders.
Top support and resistance indicators on Tradingview
Tradingview has several excellent support and resistance indicators built by expert coders. Here are some of the most popular:
- Supertrend Indicator – Clearly highlights support and resistance zones on any timeframe. Plots trendlines.
- Volume Profile Indicator – Uses volume data to draw support/resistance levels along price ranges.
- Pivot Point Indicator – Calculates potential support/resistance levels based on previous price action.
- Fibo Retracement Indicator – Plots key Fibonacci support/resistance levels based on golden ratio.
- Linear Regression Indicator – Identifies dynamic support and resistance using linear regression channels.
- Peak Trough Indicator – Highlights past extreme peaks and troughs as potential support/resistance.
These indicators help traders objectively identify influential price levels for planning trades.
Using the Supertrend indicator to plot support/resistance
One of the most useful support/resistance indicators is the Supertrend indicator. Here are tips for using it:
- Apply to price chart in main window
- Red lines indicate downtrends and areas of resistance
- Green lines indicate uptrends and areas of support
- Look for candle closes above/below Supertrend lines for breakout signals
- Use on daily and 4 hour charts for major trend support/resistance zones
- Customize ATR period length (typically 10) to adjust sensitivity
Supertrend makes it easy to visualize the key levels guiding price action.
Example of Supertrend on Bitcoin chart
Here we can see how Bitcoin’s price repeatedly respected the Supertrend-defined support and resistance levels.
Using the Volume Profile indicator
The Volume Profile indicator offers a unique way to see support and resistance using volume data. Follow these tips:
- Apply Volume Profile indicator to price chart
- Use daily or weekly timeframes to see significant volume levels
- Price ranges with highest volume show areas of support/resistance
- Look for price to react around major volume shelves on the profile
- Fading volume near support and breaking volume near resistance signals trades
Volume Profile identifies key levels other indicators may miss.
Example of Volume Profile on the eMini S&P 500 futures contract
Here we can see the S&P 500 futures contract respecting support and resistance zones defined by volume shelves.
Tips for effectively using support/resistance indicators
Here are some best practices when using Tradingview’s support/resistance indicators:
- Use on higher timeframes (4H, daily, weekly) for significant levels
- Combine indicators like Supertrend and Volume Profile for confluence
- Focus on zones rather than precise lines. Markets do not respect levels to the pip.
- Ensure sufficient volume at levels for relevance
- Expect breakouts/breakdowns when price pushes support/resistance multiple times
- Monitor price behavior at levels for signs of strength/weakness
- Be flexible – support can become resistance and vice versa when price breaks through
- Use rectangle price boxes to clearly mark influential support/resistance zones on chart
Carefully incorporating support/resistance analysis into your trading frameworks is key.
Limitations of support/resistance indicators
While support/resistance indicators are useful, some drawbacks include:
- Levels based on past data that may be outdated for current price action
- Too many minor levels can lead to false signals – focus on obvious levels
- Markets can break levels stop hunt before returning – beware traps
- Not as helpful in strong trending markets
- Works best when combined with momentum, candlestick, volume analysis
Use stops and prudent position sizing when trading near support/resistance. No analysis technique is foolproof.
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Frequently asked questions
Q: What are support and resistance levels?
A: Support and resistance levels are price levels on a chart where the price of an asset tends to find support as it falls and to encounter resistance as it rises.
Q: How can I identify support and resistance levels?
A: Support and resistance levels can be identified by analyzing historical price data and looking for areas where the price has previously reversed or stalled.
Q: Is there a specific indicator to identify support and resistance levels on Tradingview?
A: Yes, there are several indicators available on Tradingview that can help identify support and resistance levels. Some popular ones include the Best Support and Resistance Indicator and the Tradingview Support and Resistance Indicator.
Q: What is the best Tradingview indicator for support and resistance levels?
A: The “Best Support and Resistance Indicator” is one of the most popular indicators for identifying support and resistance levels on Tradingview. It is highly customizable and provides clear visual signals.
Q: Can I use support and resistance levels in my trading strategies?
A: Yes, support and resistance levels are widely used in various trading strategies. They can be used to identify potential entry and exit points, determine stop-loss levels, and assess the overall strength of a trend.
Q: What is the significance of psychological levels in support and resistance analysis?
A: Psychological levels are price levels that tend to attract a significant amount of attention from traders. These levels often act as strong support or resistance levels due to the psychological impact they have on market participants.
Q: How can I use volatility indicators in conjunction with support and resistance levels?
A: Volatility indicators, such as the Average True Range (ATR), can be used to gauge the volatility of an asset. High volatility can often lead to strong breakouts or breakdowns of support and resistance levels.
Q: Are there any bonus indicators that can complement support and resistance analysis?
A: Yes, there are several bonus indicators available on Tradingview that can complement support and resistance analysis. These indicators include trend-following indicators, volume indicators, and momentum indicators.
Q: Can support and resistance levels be applied to different markets like forex and stocks?
A: Yes, support and resistance levels can be applied to various markets, including forex and stocks. The concept of support and resistance is applicable to any market where prices are determined by supply and demand.
Q: How can I incorporate support and resistance levels into my day trading strategy?
A: Support and resistance levels can be used in day trading strategies to identify potential intraday reversal points, determine profit targets, and set stop-loss levels. They can provide valuable insights for short-term traders.
Best Support Resistance Indicator Tradingview Conclusion
Indicators like Supertrend and Volume Profile make spotting influential support and resistance straightforward on Tradingview. Marking these key zones on higher timeframes provides an objective map for planning entries and exits. Combine levels with price action and momentum clues. With the right approach, trading support and resistance offers high probability setups. Use levels to gain an advantage over price action.