FVG with Probabilities

The FVG with Probabilities indicator is a comprehensive toolkit designed to quantify the likelihood of a Fair Value Gap (FVG) holding or failing using a complex scoring model. It provides traders with objective data to distinguish between high-confluence setups and market noise, making it particularly useful for institutional-grade scalp trading and lower-timeframe analysis.

Usage

The indicator automatically detects Fair Value Gaps and assigns them a probability score based on multiple confluence factors. Traders can use these scores to filter setups:

• High Quality (H): Scores above the high cutoff (default >65%) indicate high-confluence zones where price is likely to react.
• Medium Quality (M): Standard setups with moderate confluence.
• Inversion FVGs (IFVG): When a gap is violated by a displacement candle on the opposite side, the indicator flips the zone (e.g., bullish FVG becomes bearish resistance).

Traders should look for "A+" setups which occur when price retests a high-scoring FVG within a designated Killzone, ideally supported by trend alignment (EMAs) and volume confirmation.

Details

The core of the script is a weighted scoring model that calculates probabilities between 4% and 85%. The model evaluates eight key factors:

• P/D Alignment: Checks if longs are in discount or shorts are in premium relative to swing points.
• Market Structure: Rewards alignment with recent Breaks of Structure (BOS).
• Displacement: Requires specific body-to-range ratios and ATR-relative size to ensure institutional energy.
• Consequent Encroachment (CE): Monitors the 50% midpoint of the gap as a primary reaction level.
• Regime Filtering: Adjusts scores based on volatility (ATR ratio) and institutional volume (RVOL).

Settings

The settings are organized into several functional groups:

• FVG Detection: Adjust sensitivity via the Min FVG Size (ATR multiplier) and toggle CE visibility.
• Displacement Filter: Define the strictness of displacement via body-to-range and body-to-ATR ratios.
• IFVG Rules: Configure how failed gaps are converted into inversion zones, including required displacement for the "flip."
• Quality Score: Set the thresholds for High and Medium probability cutoffs and configure EMA lengths for trend bias.
• Signal Engine: Toggle entry signals based on minimum scores, specific modes (Trend/Reversal), and Killzone requirements.
• Killzones: Define custom sessions for London, NY AM, and NY PM trading hours.
• Time-of-Day Filter: Skip volatile opens, low-volume lunch periods, or end-of-day noise.

FAQ

• How do I interpret the probability score on a gap? The score represents the confluence of factors like trend, volume, and structure. Higher percentages suggest a greater probability of the level acting as support or resistance.
• What is an Inversion FVG (IFVG)? An IFVG occurs when a regular FVG is closed through with displacement. The zone then "inverts," changing from support to resistance (or vice versa).
• How can I access FVG with Probabilities? You can get access on the LuxAlgo Library for charting platforms like TradingView, MetaTrader (MT4/MT5), and NinjaTrader for free.