Order Blocks v2

The Order Blocks v2 indicator identifies potential institutional activity by dynamically plotting bullish and bearish order blocks based on fractal-based break conditions and algorithmic time filters.

Usage

The indicator can be used to identify key supply and demand zones where institutional orders may be clustered. Traders can use these zones to anticipate price rejections or trend continuations.

Examples of usage include:

• SMC/ICT Confluence: Aligning plotted OBs with Fair Value Gaps (FVG) or specific time anchors to find high-probability entry points.
• Zone Rejection: Monitoring price action when it returns to a plotted OB zone for potential reversal signals.
• Automatic Invalidation: Users can keep their charts clean as the tool automatically removes zones once price closes through them, ensuring only active levels are visible.

Details

Order Blocks v2 detects order blocks after the break of bullish or bearish fractals. Once a fractal is broken, the script backtracks to identify the most significant candle responsible for the move (the highest bullish or lowest bearish candle).

The tool incorporates specific time-level filtering (3, 7, 11, 14), which are core anchors in algorithmic trading models such as the "Power of 3" or Hopplipka models. It also includes an optional FVG validation check, ensuring an order block is only confirmed if followed by a gap within a user-defined lookback window.

Settings

Core Logic

• Only show OB on Time Levels 3,7,11,14: Filters detections to only occur during specific algorithmic time anchors.
• Fractal Bars (3/5): Choose between a 3-bar or 5-bar fractal structure for initial detection.
• Order Blocks on break of Fractal Close or HL: Determines if the fractal break is triggered by a candle close or by the high/low reaching the level.
• Consider Order Blocks only with following FVG: If enabled, only OBs followed by an FVG are displayed.
• Max distance of FVG following Order Blocks: Sets the maximum candle distance required for the FVG confirmation.
• Order Block Height: Determines if the zone is drawn based on the candle body or the full wick.

Visuals

• Style: Sets the line style (Solid, Dashed, or Dotted).
• Length/Width: Adjusts the horizontal length and thickness of the plotted zones.
• Bearish/Bullish color: Customizes the colors for the respective order block zones.

FAQ

How do I access Order Blocks v2?

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

What is the difference between "Close" and "HL" breaks?

A "Close" break requires the price to close beyond the fractal level to trigger an OB detection, whereas an "HL" break triggers as soon as the high or low of a candle touches the level.

Why do some Order Blocks disappear?

The indicator automatically deletes zones once price closes through them. This ensures the chart remains uncluttered and only shows currently valid structural levels.