Liquidity Heatmap (Nephew_Sam_)

The Liquidity Heatmap (Nephew_Sam_) indicator identifies and visualizes resting liquidity zones above swing highs and below swing lows across multiple timeframes. By plotting a heatmap based on pivot points, it provides traders with a visual representation of where stop-loss orders and buy/sell stops are likely concentrated.

Usage

The Usage section describes how the script can be used, examples should be provided in this section. The indicator displays shaded zones (heatmaps) that extend from identified swing points. Traders can use these zones to identify potential reversal or breakout areas where the market might seek liquidity.

• Intensity and Scale: The darker the color or the larger the zone, the higher the concentration of liquidity at that specific level.
• Timeframe Filtering: If the chart appears cluttered with too many zones, users can disable specific timeframes or increase the lookback periods for pivots in the settings.
• Trend Analysis: Price often gravitates toward these zones to "clear" liquidity before continuing a trend or reversing.

Details

The indicator functions by calculating pivot highs and lows across two main categories: Intraday Timeframes and Higher Timeframes (HTF). It uses the request.security() function with lookahead = barmerge.lookahead_on to accurately map these levels from higher resolutions onto the current chart.

The script employs a multi-layered approach to visual density. Each timeframe layer is assigned a specific color transparency and line length. As multiple timeframe pivots align at the same price level, the overlaps create a "heatmap" effect, indicating a confluence of liquidity. The logic also includes an optional filter to hide liquidity levels from timeframes lower than the current chart resolution to maintain a clean workspace.

Settings

• Intraday Timeframes: A group of settings to enable/disable six different intraday resolutions (e.g., 15m, 1h, 4h). Each includes "Left" and "Right" bar inputs to define the pivot strength (highest/lowest point in X bars).
• Higher Timeframes: A group of settings to enable/disable six higher timeframe resolutions (e.g., Daily, Weekly, Monthly). Like intraday settings, these allow customization of the pivot lookback periods.
• Hide lines lower than enabled timeframes: When enabled, this setting prevents the indicator from displaying liquidity levels derived from timeframes smaller than the one currently viewed on the chart.

FAQ

How do I interpret the different colors on the heatmap? The indicator uses red-based tones for liquidity above price (buy stops/buy-side liquidity) and green-based tones for liquidity below price (sell stops/sell-side liquidity). Darker, more opaque areas indicate multiple timeframes overlapping at that price level.

Can I change the sensitivity of the liquidity zones? Yes, by adjusting the "Left" and "Right" bar settings for each timeframe, you can require more or fewer bars to confirm a swing point, making the indicator more or less sensitive to price fluctuations.

How can I access this indicator? You can get access on the LuxAlgo Library for charting platforms like TradingView, MetaTrader (MT4/MT5), and NinjaTrader for free.