Supply & Demand Zones XL

The Supply & Demand Zones XL indicator is a comprehensive technical analysis tool that models market structure by identifying supply and demand zones with a focus on stability and quantitative strength. It utilizes pivot-based detection and ATR-dynamic sizing to ensure consistent scaling across various market conditions while offering a non-repainting mode for reliable real-time signals.

Usage

The indicator can be used to identify key areas of institutional interest and potential price reversals. Users can monitor active zones as they extend in real-time, while historical zones provide context for past price action.

• Active Zones: Displayed as boxes extending from a pivot point. These areas represent potential support (demand) or resistance (supply) levels.
• Zone Strength: Each zone features a strength score from 1 to 10, calculated based on volume participation, departure velocity, and touch frequency. This helps traders prioritize higher-quality zones.
• Non-Repainting Mode: When enabled, zones only appear after a pivot is fully confirmed by the specified number of "Bars Right," ensuring that signals are permanent once they appear on a closed bar.
• Filtering: Users can apply volume filters to ensure zones are only formed on high-conviction moves or use RSI confirmation to find zones in overbought/oversold conditions.

Details

The script implements a state-driven model to manage market structure. It avoids redundant "clutter" by preventing overlapping zones of the same type while an existing zone remains valid.

• ATR Sizing: Instead of fixed pixel heights, zone width is determined by the Average True Range (ATR) at the time of the pivot, making the zones adaptive to volatility.
• Break Logic: Zones are considered broken only upon a confirmed close beyond their boundaries. Intrabar wicks that penetrate the zone without closing outside are treated as "touches" or "tests," which may affect the strength score but do not invalidate the zone.
• Composite Scoring: The strength engine uses a weighted model incorporating volume at the pivot, the speed at which price moved away from the zone (departure velocity), and the efficiency of the zone formation.

Settings

General

• Non-Repainting Mode: Ensures signals only register on fully closed bars.
• Structure Timeframe: Select the timeframe for structure calculation (e.g., viewing 30m zones on a 5m chart).
• Bars Left/Right: Sets the lookback and confirmation delay for pivot detection.
• Zone Size (ATR Multiplier): Controls the vertical height of the zone boxes.
• Disallow Overlap: Prevents multiple zones from stacking in the same price range.

Historical Zones

• Show Historical Zones: Toggles the visibility of past zones.
• Lookback Settings: Controls how many past or broken zones remain on the chart.

Zone Filters

• Use Volume Filter: Requires a minimum volume threshold at the pivot bar.
• Use RSI Confirmation: Requires the pivot to occur at extreme RSI levels.

FAQ

How do I interpret the strength score? The score is a 1-10 rating where 10 is the highest. It represents a composite of volume, price velocity, and zone purity. Higher scores generally indicate more significant structural levels.

Why did a zone appear several bars ago instead of on the current bar? This is due to the "Bars Right" setting. The script requires a certain number of bars to close after a pivot to confirm it as a structural high or low.

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