Fibonacci Clusters

The Fibonacci Clusters indicator automatically identifies and ranks high-probability Fibonacci confluence zones by clustering retracement levels from multiple recent swing pairs. It calculates a strength score for every zone based on how many distinct swing pairs agree on that price, filtering out low-quality noise to focus on the most significant market levels.

Usage

The Fibonacci Clusters tool is used to find "confluence" where multiple market moves point to the same reversal or reaction area.

• Cluster Strength: Focus on "Elite" zones (Strength 6+). These represent areas where 6 or more independent swing pairs have a Fibonacci retracement level.
• Visual Hierarchy: Higher-strength zones are displayed with brighter, more prominent colors to signify their importance.
• Extension Zones: The tool plots four key extension levels (1.130, 1.270, -0.130, -0.270) based on the most dominant swing pair, providing structural targets outside the main retracement range.
• Market Context: Use the built-in dashboard to monitor active clusters relative to the current price, current trading session, and volatility (ADR).

Details

This algorithm intelligently scans up to 15 recent swing highs and 15 swing lows, pairing them to run a confluence engine across major Fibonacci levels (0.236, 0.382, 0.500, 0.618, 0.786, 1.000). Unlike standard tools that show levels from a single swing, this script quantifies the history of multiple moves. It uses an ATR-based tolerance setting to group levels together into "clusters," ensuring the zones remain relevant to the current asset's volatility.

Settings

Swing Detection

• Swing Length (bars): The lookback period used to identify pivot highs and lows.
• Max Swings per Side: The maximum number of recent peaks and valleys used for clustering calculations.

Retracement Levels

• 0.236 - 1.000: Toggle specific Fibonacci retracement levels to be included in the confluence engine.

Extension Zones

• Extension Levels: Toggle Fibonacci extensions above the high (1.130, 1.270) or below the low (-0.130, -0.270).

Clustering

• Cluster Tolerance (x ATR): Defines how close two Fibonacci levels must be to count as a confluence.
• Min Cluster Strength: The minimum number of swing pairs required to display a zone.
• Max Clusters to Display: Limits the total number of zones shown on the chart to prevent clutter.
• Min Separation (x ATR): The minimum distance required between two displayed clusters.

FAQ

How do I interpret the strength score in Fibonacci Clusters?

The strength score represents the number of distinct swing pairs that have a Fibonacci level in that specific zone. A score of 6 means 6 different price moves confirm that level.

Can I use this for scalping or swing trading?

Yes. Because the tool uses ATR-based settings for tolerance and separation, it automatically adapts to different timeframes and assets, from Gold and Crypto to Forex and Indices.

How can I access Fibonacci Clusters?

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