Hunting ranges represent a modern approach to classical methods such as Vidya Bands and Average True Range Bands. In mm-scan, hybrid solutions are used to determine market depth based on volume, time, and price action.
Classical methods have their drawbacks, such as repainting (improving parameters after they have been drawn) or data delay (calculations based on the number of past candles). mm-scan provides a flexible and adaptive solution that easily determines effective price ranges, and the interpretation of the indicator is intuitive.
In the attached example, we see the hunting ranges with the settings 'Swing, 5, 5, -0.314.
Key directional changes can be identified especially after the loss of one of the bands. The absence of support or resistance defines the strength of the prevailing trend. The prevailing trend is the one with a consistent color (red or green). A yellow line indicates manipulation or confluence, which can lead the price to the band.
For experienced traders, hunting ranges can serve as a market scanner, while for novices, they can define optimal entry points. The example below illustrates the 1:2 RR principle. Initiating a position after the candle opens at the touch of the band, we use a 1:2 ratio. We expect confirmation within 1-2 candles and then adjust the stop loss according to the band. Compared to classical methods, Hunting Ranges are a modern Trailing Stop.
