Liquidity Heatmap LTF
May 31, 2022
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Gain deeper insights into market activity with this powerful indicator, which showcases column heatmaps to highlight candle bodies associated with the highest volumes from a user-selected lower timeframe. This innovative tool is designed to enhance your trading strategy by identifying crucial trading areas.
Understanding the Settings
- LTF Timeframe: This setting allows you to select a lower timeframe to retrieve the closing/opening price and volume data. Ensure that this timeframe is lower than the current chart you are analyzing for optimal results.
Additionally, the indicator provides various settings for you to customize the style of the displayed graphical elements to suit your trading needs better.
How to Trade with the Candle Volume Heatmap Indicator?
Spotting which candles from a lower timeframe held the most volume can offer valuable insights into market dynamics. This can help traders pinpoint areas where a candle body experienced significant trading activity, potentially hinting at vital support or resistance levels.
The highest activity areas are visually highlighted in yellow by default, though you can select a color that works best for your chart setup. This is accompanied by two lines that form an interval for clear identification.
It's important to note that if a candle body with a lower volume overlaps one with higher volume, the lower volume candle will be highlighted. This approach means that not every high-activity area will appear on the heatmap, ensuring focus on the most relevant data.
For an uncluttered view, consider hiding regular candles or adopting a more discreet presentation of price data when utilizing this indicator. Additionally, lines are displayed to indicate the full candle range and to show whether the candle was bullish (in green) or bearish (in red), which can be hidden based on your preference.
FAQ
How can I access the Candle Volume Heatmap Indicator?
You can get access on the LuxAlgo Library for charting platforms like TradingView, MetaTrader (MT4/MT5), and NinjaTrader for free.
Why are certain high-volume areas not highlighted on the heatmap?
The indicator focuses on overlapping candle bodies; hence, when a lower volume candle body overlaps a higher volume one, the former gets highlighted.
Can I customize the heatmap colors and styles?
Yes, the indicator comes with a range of settings to adjust the stylistic elements, including the colors of highlighted areas, to fit your personal trading style.
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