Reaction Zone Ledger [JOAT]

Reaction Zone Ledger is an open-source Pine Script v6 overlay that creates pivot-based support and resistance reaction zones, tracks signed volume pressure inside those zones, merges nearby zones, and displays compact statistics directly beside each active area.

The script is built for traders who want reaction zones to contain more information than a simple box. Each zone stores pressure, net impulse, touch count, state, and a dashed midpoint. The dashboard summarizes the broader signed-volume ledger and the nearest active zone.



Core Concepts

1. Signed Volume Proxy

Each bar receives a signed volume estimate from candle body bias and close location. This is not true buyer/seller volume; it is a transparent approximation from OHLCV data.

2. Pivot Reaction Zones

Confirmed pivot highs create resistance-style zones. Confirmed pivot lows create support-style zones. The width is based on ATR so the zones scale with current chart volatility.

3. Merge Logic

When a new zone is close to an existing zone on the same side, the script merges them rather than stacking overlapping boxes. This keeps the chart cleaner and improves object efficiency.

4. Zone Ledger Statistics

Each zone tracks buy pressure, sell pressure, hit count, net impulse, and state. A small outside stats box displays the current pressure reading and net value.

5. Dashboard Summary

The dashboard shows overall ledger pressure, net impulse, nearest zone type, and nearest zone state.

Features

• Pivot support and resistance zones: Zones are created from confirmed pivots
• ATR-based width: Zone size adapts to volatility
• Merge system: Nearby same-side zones combine into larger active areas
• Signed-volume ledger: Tracks directional pressure using a transparent OHLCV proxy
• Stats boxes: Pressure percentage, net impulse, and state displayed beside zones
• Dashed midlines: Each zone has a center reference line
• Dashboard: Shows active zone count and nearest zone context
• Alerts: Support reaction, resistance reaction, and zone break

Input Parameters

Visuals:

• Palette: Selects color pair
• Show Dashboard: Toggles the top-right dashboard

Zones:

• Pivot Left Bars / Pivot Right Bars: Pivot confirmation settings
• Range Length: ATR length for zone sizing
• Zone Half-Width ATR: Controls box thickness
• Merge Distance ATR: Controls when nearby zones merge
• Maximum Zones: Limits active object count
• Forward Extension: Bars each zone extends forward
• Ledger Impulse Length: Lookback for dashboard impulse stats

How to Use This Indicator

Step 1: Locate Active Zones
Green-style zones represent support reactions. Red-style zones represent resistance reactions.

Step 2: Read the Stats Box
The outside box shows whether the zone is testing, holding, cleared, lost, or mixed, along with its pressure value.

Step 3: Watch Break Alerts
A break alert means price closed beyond the zone boundary after previously trading around it.

Step 4: Use Nearest Zone Context
The dashboard helps identify whether price is closest to support or resistance and what state that zone is in.

Indicator Limitations

• Signed volume is an approximation from OHLCV data
• Pivot zones appear only after pivot confirmation
• Merged zones can become wide during repeated tests
• Zone pressure can change quickly when high-volume bars touch the zone

Originality Statement

Reaction Zone Ledger is original in its combination of confirmed pivot zones, merge logic, signed-volume accounting, outside stats boxes, and nearest-zone dashboard. It is original Pine v6 code and does not reuse another author's indicator source.

Disclaimer

This script is provided for educational and informational use only. It is not financial advice or a recommendation to buy or sell any financial instrument. Trading involves substantial risk of loss. Reaction zones can fail, widen, or become less useful in fast markets. Always use independent analysis and proper risk management.

-Made with passion by jackofalltrades