In this article I will discuss how to calculate support and resistance level very easily with excel or Openoffice calc. This is another important thing you really need to calculate the resistance and support level of a stock before you invest or trade. For our website we have an automated page that calculates all support and resistance level automatically just by entering stock name or code. If you do not have any software or such script then I will tell you in this article how to do it without any software or script.
Why do I need to calculate Support and Resistance level?
Support and resistance level give you an estimated picture of a stock's next move. It is a part of technical analysis. Defiantly support and resistance level can not tell you what can happen exactly in next trading session. But it give you an idea of a stock how much it can rise or how much it can fall. Support resistance level is considered as maximum points, that mean if support or resistance level being calculated 100 the stock might go till 100 maximum. Usually stock price changes less than support and resistance level.
What values I require to calculate support and resistance level?
You need few values of a stock to calculate support and resistance level such as Open, High, Low, Close.
What is Resistance Level?
Resistance level being calculate to know how much a stock could rise on its next trading session. Resistance level being calculated in three parts Resistance Levels. But before you start calculating you need to calculate pivot point.
What is pivot point?
In simple meaning pivot point is an average of a stock price during the day.
How to calculate pivot point?
There is two ways or formulas to calculate pivot point.
Formula 1: Pivot Point=(High+Low+Close)/3
Formula 2: Pivot Point=(Open+High+Low+Close)/4
What is the formula of resistance level calculation?
Resistance Level 1: (Pivot Point * 2) - Low.
Resistance Level 2: Pivot Point + ( High - Low)
Resistance Level 3: High + 2 * (Pivot Point - Low)
What is Support Level?
Support Level being calculated to know if a stock start to fall, then to what level it might fall maximum. Support level also being calculated in three levels.
What is the formula of support level calculation?
Support Level 1: (Pivot Point * 2) - High
Support Level 2: Pivot Point - (High - Low)
Support Level 3: Low - 2 * (High - Pivot Point)
How to calculate support and resistance level with excel or calc?
You can use these formulas to calculate support and resistance level in excel. Or you can download the support and resistance level calculator created by me for you form the link given below.