We usually just draw lines on our own to indicate support and resistance levels. While only our perception of them matters, because other have to perceive them too, it would be better if we could have an indicator of how strong support and resistance is algorithmically. These levels would be a function of two things:
(a) How often the price level hangs out around that area.
(b) How “fresh” the trend is, or how relevant it is based on how recently it was hanging out at this level.
Of course, coefficients can be set for both of these factors so you can tweak it similar to moving average and most other indicators.
I had imagined it to be very colorful. You could set a range of colors from most to least resistance and all intermediate levels would be the colors in between. I think they use this technique in topology and certain thermal imaging stuff, so a greater detail of information can be displayed.
I have a MT4 indicator that places support/resistance lines in the right areas, if price breaks through it the indicator deletes them, if price bounces off it changes from a dashed line to a solid line, if price respects it again it becomes a thickers line and continues like that. Works pretty well, but it does add a lot of lines to your charts so you’d have to get used to it.
Come to think of it, is it possible to develop a strategy based solely on support and resistance? Of course standard issues like avoiding the news would still be in place, but everything else seems way to far fetched to be used reliably, ie Fiobonachi etc… S&R is really the only thing that everyone pays attention to, and therefore is the most salient indicator…
My strategy is solely based on candle formations, psych levels (round numbers), and 1 period ATR (really just the range of each candle). My trailing and exit strategy relies completely on Fibonacci. In some rare instances, I can collect 20-30:1 reward/risk because of Fibs.
Take a look at post#262 on the Price Action Hero thread. A few days ago I attached a MT4 support resistance indicator, “Support Resistance by Barry”. It might be the kind of thing you’re looking for. Good luck!