Supply and Demand Visible Range

The Supply and Demand Visible Range indicator is specifically designed to identify key areas and levels on your trading chart using the visible range. Utilizing a novel volume-based technique, this indicator provides precise Supply and Demand zones by incorporating intra-bar data, offering traders critical insights into potential support and resistance areas.

How to Configure the Supply and Demand Visible Range Indicator

• Threshold %: This setting determines the percentage of total visible range volume that will be used to establish supply and demand areas. A higher threshold percentage results in wider areas, indicating significant levels of interest on the chart.
• Resolution: Defines the number of bins used in determining each area. A higher resolution provides more precise area delineation.
• Intra-bar TF: This setting selects the timeframe for examining intra-bar data.

How to Trade with the Supply and Demand Visible Range Indicator

The main purpose of displaying supply and demand areas and levels is to denote potential support and resistance points. These zones are recalculated dynamically as the visible chart range changes, making this indicator ideal for visual analysis.

When price approaches a supply zone (upper area), which might have faced several tests, this could signal a potential downward reversal. Conversely, price nearing a demand zone (lower area) after a few tests might suggest a possible upward reversal.

The width of each area can also convey liquid points—thinner areas often indicate significant liquidity. Traders can adjust the area width via the Threshold % setting. Increasing the threshold gives rise to wider areas, while precision settings set lower than usual can widen the areas and enhance script execution speed at the expense of exactness.

The indicator also highlights various levels. Solid lines show the average within each supply or demand area, and dashed lines depict the weighted averages, drawing attention to more liquid price levels. Central solid and dashed lines reflect the mean between standard averages and the weighted averages.

Technical Details

Supply and demand areas are formulated from comprehensive volume data using the procedure below:

• The total volume within the visible chart range is measured.
• This visible range is segmented into N equal-width bins, based on the resolution setting.
• Calculation starts at the highest price for supply areas and the lowest price for demand areas.
• Volume in each bin is accumulated until it meets or exceeds the threshold (a specified percentage of total visible range volume), thus defining the area boundary.

Each area's volume accumulation is represented on the left, providing insight into how quickly volume is being aggregated.

Limitations

While effective, there are certain limitations in script execution time, influenced by:

• An extensive visible range containing numerous bars on the chart.
• High resolution settings leading to a larger number of bins and increased computation time, particularly when combined with a high threshold percentage.
• Low intra-bar timeframe settings may augment computation time drastically, potentially resulting in errors if the chart timeframe is extensive.

To mitigate potential errors, users can opt to lower resolution settings or choose chart timeframe for intra-bar data collection.

FAQ

How can I access the Supply and Demand Visible Range indicator?

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

What benefits does this indicator offer over standard supply and demand indicators?

This indicator's unique volume-based method and use of intra-bar data facilitate more precise zone calculation, offering a strategic edge in pinpointing key support and resistance levels.