Anchor zones are formed from anchor bars. An anchor bar is a bar that has one or more of these components: wide range, high or gaps. For this script we're going to require two or more of the components. When an anchor bar forms, we'll note the high and low of the bar and draw a zone across time as prices develops. For this script, we'll also note the open and close of the candle to hint at other levels of support or resistance. The boundaries of these zones can act as support or resistance, but they also mark out the areas where price can often get trapped.
A breakout from these zones on high can suggest the beginning of a new trend. In general, anchor zones are a good compliment to price action strategies. For more information on how to use these, refer to L.A. Little's books.
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