I want to determine a method to create support/resistance lines, which are based on the frequency with which a stock bounces above or below a particular price.The more times a stock bouces up away from a price, the stronger the support line, the more it bounces below a price, the stronger the resistance.
How do I go about this? I can easily generate a frequency table (in cents - not always practical for stocks varying over a large price range), but how do I determine what prices, if any, are significant from my sample?
Any help much appreciated, especially if you are statistically minded :)
