PDH/L FVG (CRT)

The PDH/L FVG (CRT) indicator identifies high probability trading opportunities by combining Previous Daily Highs and Lows (PDH/L) with Fair Value Gaps (FVGs) to highlight potential liquidity sweeps and market reversals.

# Usage The PDH/L FVG (CRT) tool is designed to assist traders in identifying institutional entry points following a liquidity sweep. By highlighting areas where price has rejected previous day extremes and subsequently formed imbalances, users can time their entries more effectively.

## Liquidity Sweep Logic The indicator automatically draws horizontal lines for the previous day's high and low. When price breaks through these levels, a sweep event is triggered. The tool then monitors for the formation of a bullish or bearish FVG within a user defined window of bars following the sweep. This confirms that the market is attempting to reverse or continue momentum after clearing liquidity.

## Entry Timing and Filtering Users can choose between two primary entry modes. Choosing "On FVG formation" provides immediate signals as soon as the gap is identified. Alternatively, "At 50% retest" forces the indicator to wait until price returns to the midpoint of the FVG, allowing for a more refined entry with a potentially better risk to reward ratio.

## Trend Confirmation For traders looking to align with the broader market direction, the built in Trend EMA filter can be activated. When enabled, the indicator will only display long signals if the price is trading above the EMA and short signals if the price is trading below the EMA, ensuring you only trade in the direction of the dominant trend.

# Details This script is constructed using advanced price action principles, specifically focusing on the intersection of liquidity levels and market inefficiencies.

• Previous Daily Levels: The script uses a daily timeframe to anchor its support and resistance levels. These levels are stored in arrays, allowing the user to track how many days these liquidity zones persist on the chart.
• FVG Identification: The FVG detection logic looks for three consecutive candles where the gap between the first and third candle is not covered by the second candle's wick or body.
• Volatility Filtering: To ensure signals are formed during periods of significant market movement, the indicator includes an ATR based volatility filter. This prevents the script from flagging insignificant price gaps.
• Simulated Trade Management: The indicator provides built in ATR based stop loss and take profit levels. This allows users to visualize where a trade might realistically be exited based on historical volatility.

# Settings

## Levels

• Days to keep: Determines how many previous daily high and low levels remain visible on the chart.
• Line width / Color: Customizes the appearance of the PDH and PDL lines to suit your chart theme.

## FVGs

• Show FVGs: Toggles the visibility of the three candle fair value gaps.
• Use volatility filter: Filters out gaps that are too small relative to current market volatility.
• FVG ATR length/multiplier: Controls the sensitivity of the volatility filter.
• Show 50% lines: Toggles the display of the midpoint of the gap, which is often used as an entry level.

## Signals

• Enable long/short signals: Globally enables or disables specific signal directions.
• Entry timing: Toggles between "On FVG formation" or "At 50% retest" logic.
• Bars allowed after sweep: Sets the timeframe limit for an FVG to form after a liquidity sweep occurs.

## Trend Filter

• Use EMA trend filter: Activates the moving average filter to ensure signals follow the current trend.
• EMA period: Sets the lookback period for the exponential moving average used in the trend filter.

## Trade

• Stop loss/Take profit ATR multiple: Determines the distance of the stop loss and take profit targets from the entry price, calculated as a factor of the current ATR.

# FAQ

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

Can I reverse the signals? Yes, the indicator includes an "Invert signals" option within the Signals group, which swaps the logic for long and short setups.

What happens to the FVG when price fills it? By default, the indicator removes filled FVGs from the chart to maintain a clean workspace. You can toggle "Keep filled FVGs" to maintain their visibility for historical analysis.