Price Action Ultimate

The Price Action Ultimate indicator provides a comprehensive analysis of market activity by identifying key price levels based on volume distribution and price touches. This tool divides a user-defined lookback period into rows to visualize where the market has spent the most time or where the highest trading activity occurred, helping traders identify significant support and resistance zones.

Usage

The indicator can be used to visualize market conviction at specific price levels through two primary modes:

• Volume Mode: Displays levels where the most significant trading volume has occurred, similar to a Volume Profile.
• Touches Mode: Displays levels that the price has interacted with most frequently, highlighting historical areas of interest regardless of volume.

Traders can enable the Histogram (Volume or Touches Profile) on the right side of the chart to see the full distribution of activity. The Horizontal Levels feature automatically plots lines at the most significant data peaks. The thickness and transparency of these lines correlate with the importance and age of the level, allowing for a focused view of current market dynamics.

Details

The script functions by dividing the high-low range of the specified Lookback Period into a set number of horizontal rows. For each bar within the period, the script calculates:

1. Touch Count: Whether the price bar intersected with the row's price range.
2. Volume Distribution: A proportional amount of the bar's volume assigned to the row based on the bar's overlap with that row.

A unique "Weighted Count" logic can be applied to reduce the influence of older data, ensuring that the resulting profiles and levels reflect the most recent market shifts.

Settings

Analysis Settings

• Lookback Period: The number of recent bars used for the price action analysis.
• Number of Levels to Display: Determines how many of the most significant historical levels are plotted as horizontal lines.
• Display Levels for: Select whether to identify key levels based on Volume, Touches, or Both.
• Reduce Weight of Older Bars: When enabled, newer price action carries more weight in the calculations than older data.

Profile Presentation Settings

• Show Volume Profile: Toggles the visibility of the volume-based histogram.
• Show Touches Profile: Toggles the visibility of the touch-based histogram.
• High/Low Activity Color: Customizes the gradient used to represent activity intensity in the profiles.
• Analysis Range Background: Highlights the specific lookback area used for the current calculation.
• Number of Rows: Controls the vertical granularity of the profile and level detection.

FAQ

How do I interpret the different line thicknesses? Thicker lines represent price levels with higher relative activity (more touches or higher volume) within the lookback period, indicating stronger potential support or resistance.

Can I see both volume and price touches simultaneously? Yes, by setting "Display Levels for" to "Both" and enabling both profile options in the settings, you can compare where volume was traded versus where price simply interacted.

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