Tom Demark (TD) Range Projections

Is this the perfect technical indicator? Of course it isn't…

But it can be very useful.

Tom Demark also developed the technical indicator - the TD Range Projections. It gives us the opportunity to predict or project the next bar's range and shows if it's expected low or high. The projections depend on the links of the open to close of the latest period.

1) Close of the most recent bar is less than the open:
(Current High + 2 * Current Low + Current Close) = X
Projected High = X - Current Low
Projected Low = X - Current High
2) Close of the most recent bar is greater than the open:
(2 * Current High + Current Low + Current Close) = X
Projected High = X - Current Low
Projected Low = X - Current High
3) Close of the most recent bar is equal to the open:
(Current High + Current Low +2 * Current Close) = X
Projected High = X - Current Low
Projected Low = X - Current High
It's important to remember that if prices open outside the channel (above or below the projected high or low) then prices are likely to move on in the direction of the breakout. And if the open is within the projected range, it should stay within that range.