Price Action Candles

The Price Action Candles indicator provides a visual framework for price action traders by dynamically coloring candlesticks based on their relationship with the previous bar's range. It helps users quickly identify inside bars, outside bars, and standard trend bars to better interpret market structure and potential reversals.

Usage

The indicator is designed to simplify the identification of specific candle types that are foundational to price action trading. By applying unique colors to different formations, traders can more easily spot:

• Inside Bars: These occur when the current candle's high and low are completely contained within the previous candle's range, often signaling consolidation or a potential breakout.
• Outside Bars: These occur when the current candle's high is higher and the low is lower than the previous candle, often signaling increased volatility or an engulfing reversal.
• Regular Bars: Standard bullish or bearish candles that do not meet the criteria for inside or outside bars.

For the best visual experience, it is recommended to disable the default TradingView candlesticks (Body, Borders, and Wicks) in the Symbol settings menu, allowing the indicator's custom plots to take precedence.

Details

The script evaluates the relationship between the current bar and the preceding bar (index [1]).

• Inside Bar Logic: high < high[1] and low > low[1]
• Outside Bar Logic: high > high[1] and low < low[1]

By categorizing bars into these three primary types (Regular, Inside, Outside) and further splitting them by directional bias (Bullish vs. Bearish), the tool creates six distinct visual states. This categorization is useful for confirming entries at key support/resistance levels or identifying shifts in market momentum.

Settings

Bullish Colors

• Regular: The color assigned to standard bullish candles where the close is higher than the open.
• Outside: The color assigned to bullish candles that engulf the previous bar's range.
• Inside: The color assigned to bullish candles that are contained within the previous bar's range.

Bearish Colors

• Regular: The color assigned to standard bearish candles where the open is higher than the close.
• Outside: The color assigned to bearish candles that engulf the previous bar's range.
• Inside: The color assigned to bearish candles that are contained within the previous bar's range.

FAQ

How do I use this indicator for entries? Traders often use Outside bars as reversal signals at key levels or Inside bars as signals of an impending breakout.

Why do I see double candles on my chart? You must disable the default candles in your TradingView chart settings (Settings > Symbol) to see only the Price Action Candles.

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