The dynamics of quotes for any period is a movement between the previously formed or emerging highs and lows. When the quote reaches such an extreme level, the direction of its movement often changes (becomes either opposite or sideways). To define these reversal levels, Zone indicator drawing the appropriate markup on the chart.
This markup consists of red and blue rectangles, symbolizing the zones, respectively, resistance and support (Fig. 1). Resistances are formed at the levels of price highs, and supports are formed at the levels of price lows. Therefore, the indicator is based on the extremum identification algorithm.
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Zone Indicator Description
To determine price extremes, it uses the Awesome oscillator algorithm. It is calculated by subtracting the values of one MA from the values of another MA. The result of this difference is then processed in a specific way, providing accurate identification of the minima and maxima. A trader can customize the periods of these movings (parameters MA1 and MA2), the method of calculating them (parameter MetodMA) and the type of price used in the calculation (parameter Price_MA).
Another parameter that affects the results of the Zone's support and resistance indicator is TF. It defines the estimated timeframe for the Awesome Oscillator, and is set in minutes. Thus, with TF equal to 1, the calculated timeframe will be M1, with 5 - M5, with 15 - M15, etc. In this case, the levels corresponding to the calculated timeframe will also be displayed on the chart with a different timeframe. The Awesome Oscillator is calculated on the interval, the length determined by the MaxBars parameter (in the calculated TF candles).
The rest of the parameters determine the features of the visualization of zones:
- Rcolor / Scolor - color of rectangles of support / resistance zones;
- Txt_Color - color of zone labels;
- Back_Ground - whether the area rectangles need to be filled;
- Rectangle_Width - the width of the lines of the borders of the rectangles of the zones;
- Rectangle_Style - line style of borders of rectangles of zones;
- TxtSize - size of signature characters;
- RectShift - the amount (in candles) of the shift of the left side of the zone rectangles to the right.
The vertical width of the zone is equivalent to the length of the upper or lower candlestick shadow, respectively, the high or low.
Examples of using the Zone indicator
Knowing the location of supports and resistances is required when using breakout or rebound strategies.
The purple arrow in Fig. 2 shows the moment of resistance formation at the hour TF. Then the quote dropped and rose again to resistance, forming support. In this case, you can sell at the current price with StopLoss above the resistance (yellow horizontal) and TakeProfit at the upper border of the near support.
It is advisable to use the rebound strategy during a flat.
The situation in Fig. 2 can also be used for breakout trading. In this case, the yellow horizontal line marks the level of placing a pending buy order with StopLoss at the upper border of the nearest support and TakeProfit at the lower border of the nearest resistance from above.
It is advisable to use breakout strategies on a trend. For example, in Fig. 3 shows an uptrend, in which all emerging resistances broke through for several candles with the formation of higher resistances (as a result of pullbacks following the trend impulse), which then also broke through.
Zone indicator with alert
Since any trading actions of a trader occur only when the price approaches a level, enters it or crosses it, it is advisable to equip the Zone support and resistance indicator with an alert. The practical implementation of this option is offered, but not free of charge, but for several tens of dollars. It provides notifications by a pop-up window or by email, and also changes the color of the zone depending on the position of the quote relative to it.
An alternative way of using alerts in conjunction with the Zone indicator is the manual installation by the trader of this function, which is built into the MT4 terminal. This is done as follows (Fig. 4):
- the mouse cursor is set to the level, upon reaching which the alert should be activated (in the future, the alert arrow can be moved vertically, like any other graphical object in the quotes window);
- right-clicking the mouse activates the context menu;
- in it the item "Trade-Alert" is selected.
As a result, when the quote reaches the specified alert level, a sound signal will be generated (you can choose a different notification method, as well as change other alert settings in its properties window, shown in Fig. 5).
Thus, using the functionality of the trading platform, it is possible for free and sometimes easier and more convenient to achieve exactly the same result that the paid versions of indicators provide. A trader is only required to be able to use the functions of the MetaTrader 4 terminal, to know their features and be smart.
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The most important driving force of the Forex market is the law of supply and demand. It is he who makes the market price move, then up, then down along certain corridors, limited by the levels of support and resistance.
It is well known to all market speculators, without exception, that the effectiveness of trading largely depends on the correct determination of these levels. More precisely, all support and resistance levels actually form zones that limit price fluctuations.
In the support and resistance zones, a change in the distribution of sellers and buyers takes place. Knowing this, experienced speculators in the purchase and sale of assets. Here comes to the rescue Zone indicator.
Zone price levels indicator
Having practical experience in drawing lines that limit the price corridor, you can get a good profit. At the initial stage of trading, novice speculators, when defining such trading zones, face many mistakes and, as a result, loss of funds as a result of incorrect entry into the market.
However, indicators of building support and resistance areas can provide real help to a beginner. One of these tools is the Zone indicator.
It automatically draws the important above levels. At the initial stage of trading, Zone can be a good help for a beginner in identifying and preventing many graphical mistakes made by manually defining these areas.
In addition, the Zone level building indicator is a good addition to the existing trading strategy. The boundaries drawn by the tool largely depend on its settings. Some of them should be left as default.
The Zone indicator can be easily downloaded and installed in the root directory of the MetaTrader 4 platform (how it is done). After restarting the program from the navigator window by pressing the right mouse button, it is transferred to the chart of the selected asset.
Zone indicator parameters
You can change the parameters of the instrument in its settings, which are visible on the screen.
There are a few of the most significant Zone input parameters that should be highlighted:
- TF - time period for defining zones. Its values can be 1, 15, 30 and 60 minutes. The interval is selected depending on the intended trading method;
- MaxBars - the number of bars defining the zones. By default, the parameter is 1000;
- Rcolor - color of resistance areas (red by default);
- Scolor - color of support areas (green by default);
- TxtСolor - the color of the text displaying the support and resistance levels;
- BackGround - indicator of displaying zones, if set to false, the boundaries of zones are shown, if set to true, areas are colored entirely;
- RectangleWidth - the width of the lines enclosing the zones (default 2);
- TxtSize - the size of the text of the symbols of the tool;
- RectShift - shift of the zone by the specified number of bars.
Assessing the accuracy of plotting the required boundaries by the indicator of the Zone levels, it should be noted that, like any similar instrument, it has a certain margin of error. Sometimes it defines a too high range of price movement, so the boundaries have to be adjusted manually.
Nevertheless, such adjustments contribute to the acquisition of practical experience, which will certainly come in handy later. Experts advise setting the TF parameter at least 30 minutes in order to trade on a five-minute timeframe. In this case, the Zone algorithm draws the entry points to the market more accurately.
If we set the above indicator equal to 5, and consider trading on a five-minute interval, then it can be seen from the figure that several insignificant levels are drawn, which should not be paid attention to.
An important resistance zone, drawn at the top of the chart, is displayed too wide. Therefore, it should be adjusted manually later. By setting the TF parameter to 60, the investor will receive more accurate hints for opening buy and sell positions.
When using the above indicator, you should remember that this is just an additional tool that confirms the speculator's decision to open a trading position for the selected asset.
The easiest way to find good entry points and filter signals from various strategies is to learn how to correctly identify the levels near which the price will meet a strong obstacle. You can mark them yourself, which is very troublesome, but the easiest way is to use the Zone indicator, which is taught to find strong resistance and support zones in Forex, displaying them directly on the price chart of the selected asset.
Further, as they say, it is a matter of technique, since knowing where the price will be stopped, you can find a point with a good risk / reward ratio by placing a stop behind the level and taking a movement that is good in duration. There is apparently no simpler and more reliable way to make money on Forex, if you do not consider the insider. So, against the background of the above, it should be clear how important the role of the Zone indicator is. By the way, this is not the first tool designed to find strong horizontal levels, but it is definitely one of the most effective.
Get and install the indicator in your MT4
First, you need to download the Zone indicator HERE, since it is not included in the standard set of MetaTrader4 terminal tools. Next, you need to install it according to a simple scheme:
- Open terminal;
- select File at the top;
- click Open data directory;
- in the window that appears, find the MQL4 folder and open it;
- inside there is a subfolder Indicators, where you need to place the file of the previously unzipped indicator Zone.
After that, it is better to restart the terminal and find the installed indicator on the left in the "Navigator" window, where it will be located inside the "Indicators" category at the very bottom of the list.
The next step is to move the indicator to the chart of the required instrument. Joining is done by simple drag and drop. And at this moment a window will open, where in the "Input parameters" tab you can see the settings of the Zone tool, which we will now describe.
Level detection indicator settings
By attaching the indicator to the chart, the trader will see such settings in the tab with input parameters.
Among the most important settings are the following:
- TF is short for timeframe, that is, here they set a time interval in minutes, which can be set to 1, 15, 30, 60;
- Max Bars indicates the maximum number of candles the Zone indicator uses to determine buy and sell zones;
- Rcolor sets the color for the resistance or resistance zone;
- Scolor also displays hue, but for support or support;
- Txt Color, respectively, allows you to determine in what color the labels for the levels will be displayed;
- Back Ground allows you to paint over the entire area of found zones if you select the true parameter, but if false, the zone will be highlighted on the chart only along its borders;
- the Rectangle Width parameter allows you to change the thickness of the lines that outline the buy and sell zones;
- Txt Size sets the size of the text;
- Rect Shift allows you to adjust the shift of the found areas by the specified number of candles.
What the indicator looks like and how to work with it
Once installed on the chart, the Zone indicator will begin to draw the last significant support and resistance levels on it, colored green or red, respectively. It looks like this in the mt4 terminal.
Thus, the trader does not have to do the markup on his own, which can cause a number of difficulties for beginners and take extra time from professionals. At the same time, as mentioned above, trading from levels today is the simplest and most effective way to make money on any financial markets.
Unlike many other similar indicators that help build levels, Zone indicates those that matter the most. In fact, he does not just mark horizontal levels, but shows areas where there was a strong reaction. Therefore, we can assume with a high degree of probability that the next time the price approaches them, the market will again give a strong reaction.
You can use the Zone indicator in practice both independently and in combination with any trading strategy. For example, the appearance of Price Action reversal patterns near the zones found using the indicator indicates that the probability of their successful completion is much higher than in the usual case.
At the same time, when the price approaches the zones, you can open deals in the opposite direction, counting on a rebound, without using any other analysis tools.
- in the TF field of the indicator parameters, he advises to write 30 so that Zone finds significant levels in the M30 timeframe;
- At the same time, trading itself is conducted on M5, where it is necessary to look for reversal formations near the found zones.
Acceptable inaccuracies
When assessing the accuracy of levels, it is important to keep in mind that no indicator can accurately indicate the presence of a level at a specific price. You should always understand resistance or support not as a level, but as a certain area or zone. Therefore, when the price approaches such an area, it is important to set a stop loss taking into account market realities, using the designated zones as a guide.
The author of the Zone indicator does not recommend drawing levels on a timeframe less than M30, since they do not play a big role even in intraday trading. Only significant areas on the 30 minute chart, 1 hour and above will give a strong reaction that will allow you to make good profits with a high chance of success.
A correct understanding of what the Zone indicator displays will allow you to use its advantages to the maximum, establishing calm and profitable trading! The main thing is not to perceive it as the Grail, and always take into account the general picture of the market.
Hello everyone. In the comments to one of my articles, the reader mentioned the Zone indicator for MT4. I won't say that I praised him somehow, but he interested me. I decided to download and see what kind of beast.
I must admit, the development is very worthwhile. The indicator is designed to determine price levels and visualize resistance and support levels. What to do next with these levels, I think you know yourself, and I will tell you more about the indicator and show how it works.
The principle of plotting price levels in the Zone indicator
To my regret, the developer of the Zone indicator allowed using only the .ex4 file, and as we know from this article, files with such extensions cannot be edited.
Why did I need code access? I wanted to see what algorithm the indicator costs price levels. This did not work out, but the desire still remained.
I had to run the indicator with a tester and try to independently determine the sequence and figure out the algorithm.
It seems to me that this was done by 90%. There are some nuances that I could not determine, but in general, the well-known principle of building supply and demand levels, used by many traders, is used.
If we are dealing with a support zone, then the indicator needs to determine three points:
- Point "A" - the previous high;
- Point "B" - the minimum of the corrective movement;
- Point "C" - close above the previous high.
As soon as it closes above the previous high (a breakout is not considered a tail), the Zone indicator considers that the uptrend continues and draws a support zone in the area of point "B". The length of the area is calculated from the minimum of the correction to the RectShift parameter, which I will talk about later.
If we are dealing with a resistance zone, then the indicator needs to determine three points:
- Point "A" - the previous low;
- Point "B" - the maximum of the corrective movement;
- Point "C" - close below the previous low.
As soon as it closes below the previous low (a breakout is not considered a tail), the Zone indicator considers that the downward trend continues and draws a resistance zone around point "B". The length of the area is calculated from the maximum correction to the RectShift parameter, which I will talk about later.
In this case, the settings are not intended to introduce any of their own parameters for searching for price levels; rather, design buns are presented here, designed for the individual perception of the color scheme by an individual trader.
The maximum that we are allowed to do is change on which timeframe the levels are calculated and the maximum number of bars used.
I will list the possible settings:
TF- select the timeframe, where the value 1 = 1 minute, that is, if you need to calculate for 5 minutes, set the value 5, for 60 hours, for 4 hours 240. Below is the value for the timeframe of interest:
- 1 - M1;
- 5 - M5;
- 15 - M15;
- 60 - H1;
- 240 - H4;
- 1440-D1;
- 10080 - W1;
- 43299 - MN.
MaxBars- number of bars to define zones;
Rcolor- color for the resistance level;
Scolor- color for the support level;
TxtColor- text color;
Background- false value disables filling for price zones, true value fills the price zone depending on its type;
RectangleWidth- parameter of the stroke line thickness for price levels;
RectangleStyle- stroke style for price levels;
TxtSize- font size;
RectShift- shift of the zone to the right by RextShift bars.
After all the settings are set, you can click on OK and the markup of significant price levels will appear on the chart.
How to trade with the Zone indicator
Trading with support and resistance levels comes down to two postulates:
1. When the price bounces off the support level, it is more profitable to buy the price than to sell. When the price bounces off the resistance level, it is more profitable to sell than buy.
2. If the price breaks the support level, it is more profitable to sell than buy. If the price breaks the resistance level, it is more profitable to buy than sell.
The topic is described in great detail in the article Resistance and Support Levels in the Forex market, so it makes no sense to return to this. Within the framework of this article, we can only add that the Zone indicator helps to find price levels and makes it clear where is the resistance level and where is the support level.
If you approach more scrupulously and decompose the actions in steps, the following algorithm will come out:
- The Zone indicator plots support and resistance levels.
- When approaching a price level, you should pay attention to reversal patterns. If they are present, the probability of a reversal from the zone increases.
- If there are no patterns and the price breaks the price level, the indicator redraws the zones and makes it clear that the probability of movement towards the broken level is high.
- When entering a trade, do not over-risk. 1 - 2% of the deposit, this is the amount that successful traders advise.
Setting up an alert (Alert)
At the time of this writing, the Zone indicator is probably devoid of one of the most important advantages, notification (alert). It would be much better to approach the monitor only at the right moments, namely when the price has reached a level. The indicator could signal us.
But, there is no such function, which means you have to break your head.
One of the most elementary ways comes to mind: installing the built-in alert from the MetaTrader 4 terminal set.
Hover the mouse cursor over the price of interest (in our case, the price level indicated by the indicator) and right-click. From the window that appears, select Trade -> Alert. An alert will be set at the specified price, upon reaching which a signal will be triggered.
The second option for using the alert in the Zone indicator is to combine one with the other. One is the Zone indicator, the other is my Mian v2.0 indicator.
Here the idea is the following, in my indicator there is an alert function that is activated when you touch a designated area. If in Mian v2.0, areas need to be drawn by hand, then in conjunction with Zone, these areas will be automatically created, picked up by Mian v2.0 and an alert will be set.
In general, try it. I tried it, I got it.
Pros and cons
There are plenty of pluses. The 100% indicator is suitable for novice traders to figure out where to set price levels. As I said above, I conducted testing on history and, admittedly, the idea is working. The levels are determined very accurately, and most importantly, thanks to the redrawing of the supply and demand zones, the chart is not cluttered with unnecessary information.
In the cons I will write down only one, little important fact, and besides, maybe I just did not figure it out.
The Zone indicator has settings:
- Metod_MA;
- Price_MA.
No matter how I suffered, I did not understand what kind of function it was, and besides, when changing parameters, my terminal completely freezes. Maybe this is a bug, or maybe as he said, he just did not figure it out. I leave it to your judgment and I hope in the comments tell us what happened with you.
Use it. I hope this indicator is useful to you and will help you earn thousands of green money.
Today my article is about the Zone support and resistance indicator. This indicator marks on the chart the levels from which price reversals occurred on different timeframes in the past (you can download the support and resistance levels indicator for MT4 Zone at the end of the article).
Still, no matter who says what, in trading they play one of the most important (if not the most) roles. , fundamental analysis is a subject of controversy among traders. But not levels. Support and resistance levels are monitored by absolutely everyone, even the smallest literate traders.
The easiest way to draw levels is to draw horizontal lines on the chart at the points from which the price has reversed in the past. However, if we consider only one timeframe (especially a small one, such as M5 or M1), you will notice that the levels are very unreliable. The fact is that support and resistance on M1 or M5 is much weaker than support and resistance on H1 or H4. . In this regard, it becomes necessary to view levels from different timeframes on the same chart. It is for this purpose that the indicator of support and resistance levels Zone was developed.
How do I use the Zone indicator?
First, you need to understand the settings of this indicator of price levels. In fact, there are only two important settings in it:
- TF - timeframe for which the indicator will draw support and resistance levels;
- Maxbars - the number of candles by which the levels will be plotted.
With TF, everything is simple, in this parameter you need to set the timeframe you are interested in in minutes. That is, if you want to get support and resistance levels from the five-minute timeframe, then you need to set the value to 5, and if from the hourly, then to 60, and so on. Just in case, here's the complete list:
- 1 for М1,
- 5 for М5,
- 15 for М15,
- 60 for H1,
- 240 for H4,
- 1440 for D,
- 10080 for W,
- 43299 for M.
The Maxbars parameter is set to 1000 by default, which is optimal in principle. You can put a smaller one, if there is so much in yours, so that it doesn’t once again. This is how the chart will look like on the M5 timeframe with the levels plotted according to H1:
Actually, you need to use this indicator in the same way as any other indicators of mt4 levels:
- When reversing from the levels - trade the reversal;
- When the levels are broken, we trade the breakout.
As additional filters for the “strength” of levels, you can add other level indicators to the chart, for example, and / or.
Another logical filter would be the use of oscillators. Absolutely any oscillators can be added, from experience, they are good, and.
But when news comes out, you shouldn't rely heavily on the Zone indicator. The high volatility associated with the publication of economic data can easily lead to the fact that even the strongest levels will be broken.
Summary
In my personal opinion, the Zone indicator is one of the best indicators of support and resistance levels for. It can be plotted on the chart several times using different parameters, thereby obtaining a clear picture of reversal levels from all timeframes. This approach will allow filtering signals of absolutely any strategies, both trend and reversal.
You can download the support and resistance levels indicator for mt4 Zone for free at the link:
Detailed instructions on how to install additional indicators in Metatrader,
UPD: Another SS_SupportResistance level indicator (which does not freeze when calculating a large number of bars).
