OB/FVG Precision Overlap Zones

The OB/FVG Precision Overlap Zones indicator identifies and highlights specific price levels where Order Blocks (OB) and Fair Value Gaps (FVG) intersect, providing a confluence-based approach to institutional supply and demand trading.

Usage

The tool is designed to filter out secondary price action signals by focusing only on areas where two distinct Smart Money Concepts (SMC) overlap. When an OB and an FVG occupy the same price range, a highlighted "Overlap Zone" is drawn on the chart.

• Bullish Overlap: Occurs when a bullish FVG (low > high[2]) intersects with a recent bullish Order Block. These zones act as high-probability support levels for long entries.
• Bearish Overlap: Occurs when a bearish FVG (high < low[2]) intersects with a recent bearish Order Block. These zones act as high-probability resistance levels for short entries.
• Taps and Fills: The indicator tracks when price enters a zone (Tap) or completely breaches it (Fill/Invalidation). Visual markers and box transparency changes indicate when a zone has been mitigated or broken.

Details

The script functions by first identifying standard 3-candle Fair Value Gaps. Once a gap is detected, it searches back through a user-defined lookback period to find the most recent "opposite" candle (the Order Block) that preceded the impulse move.

The indicator then calculates the mathematical intersection between the OB bounds and the FVG bounds. Only this intersection is displayed, ensuring traders focus on the highest-density liquidity area rather than the entire FVG or OB range. The script supports both "Full Wick" and "Body-only" OB detection modes to accommodate different trading styles.

Settings

• OB lookback bars: Determines how many bars to look back to find the corresponding Order Block relative to the FVG.
• Box Transparency: Adjusts the visibility of the overlap zones on the chart.
• Show Bullish/Bearish: Toggles the visibility of specific zone types.
• Extend boxes right until filled: If enabled, zones will project forward until price moves through the bottom (for bullish) or top (for bearish) of the zone.
• OB by candle body: Toggles whether the Order Block is calculated using the full wick or only the candle body.
• Max Labels to Show: Limits the number of "OB/FVG Overlap" labels displayed to maintain chart clarity.

FAQ

How do I use the "Tapped" signals?

A "Tapped" signal occurs the first time price re-enters a created zone after the initial impulse. This is often used by traders to look for lower-timeframe confirmations for a reversal.

What is the difference between an OB and an Overlap?

While a standard Order Block covers the entire preceding candle, the Overlap only shows the portion of that candle that also contains an unfilled Fair Value Gap, representing a more precise point of interest.

How can I access OB/FVG Precision Overlap Zones?

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