This indicator displays defining ranges ( DR ) and implied defining ranges ( IDR ) constructed from two user set sessions (RDR/ODR) as graphical candles on the chart.
This indicator displays defining ranges ( DR ) and implied defining ranges ( IDR ) constructed from two user set sessions (RDR/ODR) as graphical candles on the chart. The script introduces additional graphical elements to the original DR / IDR concept and as such can be thought as a graphical method in addition to a technical indicator.
Additionally, this script can display various Fibonacci retracements from the constructed DR / IDR if enabled within the settings.
By default, the 0.5 retracement (average line) is displayed.
The used sessions are highlighted by a gray background. IDRs are highlighted by dashed lines while DRs are highlighted by solid ones. The maximum/minimum price between each user set session is highlighted by solid wicks.
The color of the DRs/IDRs/wicks are determined by the price position relative to the IDR ; if price is above the maximum, then a blue color is used. If price is below, then an orange color is used, and if price is within the IDR range, then a gray color is used.
Additionally, the area of the range is used to highlight the number of time price is located within the , with a longer background highlighting a higher number of occurrences. This can help highlight if the levels were potentially useful as support/resistance.
When price is outside the range, the area between the price and is highlighted, in blue if price is above the , and orange if it is under.
The original author of the DR / IDR concept describes 3 rules using the price position relative to the DR / IDR levels:
We can see that the above rules are cases of conditional probabilities.
There is no significant data supporting or regarding any statistical probability of the above rules to be true, which are more than uncertain given the stochastic nature of prices. The lack of precision of these rules is also a concern (time zone dependance, applicable markets, etc...).
Credits to trader TheMas7er who originally created the DR / IDR concept in November of 2022. This script was derived from his proposed session times & rules for trading.