CLAM indicator is revealing support and resistance levels.

COINBASE:BTCUSD   Bitcoin / Đô la
Heikin Ashi candles work best with the Candle Length Average Multi-timeframe (CLAM) indicator. When CLAM diverges after major moves, it means a support or resistance level has been hit and prices are stuck or trending away. Divergence can go on for days. CLAM merely shows where prices should be going if the previous trend is in continuation. If the long-term trend is continuing, candlesticks will generally line up with CLAM and keep returning to it like a mean or average. Divergence, then, depending on how long it goes on and if it does not snap back, could be signaling a new trend developing in the direction away from CLAM.

But when there is a large divergence like today, CLAM stops tracking and predicting prices accurately, which can be a concern. Simply flip chart upside down and line it up with the price again. Then CLAM starts tracking price again and also emulates support and resistance levels as shown here. When (or if) price converges again (diverges from CLAM in the flipped chart), it could mean the underlying is done rolling over and is rolling back, and so we can flip the chart back upright. Price action may be seen to flip back and forth more frequently on smaller timeframes.

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