Liquidity Peaks

30 Jun 2023

The "Liquidity Peaks" indicator is a tool designed to identify significant supply and demand zones based on volumetric analysis. It analyzes the volume profile within a specified lookback range to pinpoint the most volumetric point and draw corresponding zones on the price chart.

The 𝐋𝐢𝐪. 𝐏𝐞𝐚𝐤𝐬 indicator utilizes volume data to identify key supply and demand areas on the price chart. By examining the volume profile within a defined lookback range, it highlights three distinct zones: liquidity grab, volume containment, and the most volumetric point.

Zones and their meanings:

• Liquidity grab (Orange box): This zone represents a price level where there is a significant swipe of the previous demand zone within the volume range. It indicates a potential shift in market sentiment and serves as a key supply or demand area.
  
• Volume containment (Gray box): This zone displays the area of volume contained before the peak in volume. It provides insights into the range where buying or selling pressure was concentrated, highlighting potential support or resistance levels.
  
• Most volumetric point (Light blue box): This zone represents the point within the lookback range that exhibits the highest volume. It signifies a significant area of market interest and indicates a potential supply or demand level.
  

Adjustable options:

• Adjust liquidity Grab: This option allows you to adjust the size of the boxes. When enabled, the box size is set to twice the size of the high or low of the candle's wick. This adjustment enhances the visibility and accuracy of identifying swipes at specific price levels.
  
• Show origin: Enabling this option ensures that the liquidity boxes are drawn from the wick they were created from. This provides a clear visual reference to the specific candle and highlights the liquidity levels associated with it.
  

Utility:
The 𝐋𝐢𝐪. 𝐏𝐞𝐚𝐤𝐬 indicator is a valuable tool for traders and investors seeking to identify significant supply and demand zones in the market. By analyzing volume data and drawing corresponding zones on the chart, it helps to pinpoint areas where buying or selling pressure is likely to emerge.

Traders can utilize this information to identify potential support and resistance levels, plan their entries and exits, and make more informed trading decisions. The liquidity grab zones can act as potential reversal or breakout points, while the volume containment zones and most volumetric points provide insights into areas of high market interest.

It is important to note that this indicator should be used in conjunction with other technical analysis tools and indicators to confirm trading signals and validate market dynamics.

Example Charts:

5 Jul 2023

Nota Keluaran

Updated license