Order Blocks Only

The Order Blocks Only indicator automatically detects and highlights institutional supply and demand zones to help traders identify high-probability reversal and continuation areas.

Usage

The Usage section describes how the script can be used to navigate Smart Money Concept (SMC) and price action strategies. Bullish Order Blocks (OBs) are typically used as potential support areas for buy entries, while Bearish OBs act as resistance zones for sell setups.

The indicator provides visual boxes on the chart that represent these key zones:

• Bullish OBs: Displayed in green, these zones form following a swing low and are often used to find entries in an uptrend.
• Bearish OBs: Displayed in red, these zones form following a swing high and are used to find entries in a downtrend.

Traders can combine these zones with other technical analysis tools such as Fair Value Gaps (FVG) or volume profiles for added confluence. The tool also includes real-time alerts that trigger when a new Order Block is formed, allowing for efficient monitoring of multiple timeframes.

Details

The script identifies Order Blocks by locating specific swing high and swing low points (fractals). Once a swing is detected, the algorithm searches backward for the "opposite candle" (the last bearish candle before a bullish move or the last bullish candle before a bearish move) to define the boundaries of the block.

To ensure the quality of the detected zones, the script employs two optional filters:

1. Displacement: Requires the price move following the swing to be significant (greater than the 14-period ATR).
2. Volume Filter: Ensures the move occurred on high relative volume compared to a moving average.

Zones are dynamically managed; they are automatically removed from the chart if the price closes beyond the zone (mitigation) or if a specific number of bars have passed (expiration).

Settings

Order Blocks

• Box Extension: Determines how many bars into the future the OB boxes will extend.
• Box Opacity: Adjusts the transparency level of the shaded zones.
• Show Midline: Toggles the visibility of a dashed line at the 50% level of the Order Block.
• Bullish/Bearish OB Color: Allows customization of the colors used for support and resistance zones.
• Require Displacement Candle: When enabled, only identifies OBs followed by a strong price move.
• Require High Volume: When enabled, OBs are only validated if the price move occurs on high volume.
• Volume MA Length / Multiplier: Configures the threshold for the high volume filter.
• OB Buffer (points): Adds a small padding to the top and bottom of the detected zones.
• Show Order Blocks: Toggles the overall visibility of the indicator on the chart.

FAQ

How do I access Order Blocks Only?

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

What causes an Order Block to disappear?

An Order Block is mitigated and removed if the price closes above a bearish zone or below a bullish zone, or if it exceeds the "Box Extension" limit.

Can I use this on any timeframe?

Yes, the indicator is designed to be adaptive and can be applied to any timeframe, from intraday scalping to long-term swing trading.