X Lines indicator
Static barriers are important price levels that have a direct impact on trade in the foreign exchange market. It is difficult to overestimate their importance for entering the market, or for determining the moment of closing the position. Static support and resistance levels often act as reversal points and are therefore present on the charts of the absolute majority of successful traders.
When determining static levels, the trader needs to independently analyze the selected trading instrument in the future, in other words, assess the historical areas of support and resistance and highlight those that combine with each other.
If the trader has a large number of active instruments, such a simple task becomes a time-consuming process. Why not optimize such a mechanical task? The X Lines indicator provides a solution for automatically defining static price levels.
Characteristics of the indicator
Platform: MT4, MT5.
Trade tool: any.
Trading time: relevant regardless of the length of transactions.
How does the indicator work?
The X Lines indicator analyzes the historical quotations of the sales instrument and generates important static price levels on its own. The analysis is based on the selected number of bars, so the trader can limit the analysis period himself.
Another parameter, Positive Power, determines the elasticity of the indicator: a high value of the variable will reflect more potential static levels on the graph, and a low value will highlight the most significant barriers. Standard value of parameter 0.114.
How to use in trade?
The X Lines indicator cannot offer a stand-alone grid to enter the market, but is an effective tool in the comprehensive analysis of the tool offered by, for example, the Three Elder Screens system.
In the example of the currency pair USD/CHF described, the X Lines indicator potentially confirmed the sale from the static resistance 0.9790 (combination of upper levels) with a target of 0.9528 determined by the previous daily minimum of September 18.
A key advantage of the X Lines indicator is the automatic identification of important price levels in the graph. The disadvantages of the tool include the need to recalculate the indicator when changing the time frame.