Ultra Supply & Demand

The Ultra Supply & Demand indicator is a sophisticated market analysis tool that identifies and overlays key liquidity zones on the chart to help traders spot potential reversal points and institutional activity. By combining price action patterns with volume-based metrics, it provides a comprehensive view of market sentiment and supply/demand imbalances in real-time.

Usage

The indicator can be used to identify high-probability entry and exit points based on the interaction between price and the identified zones.

• Zone Identification: Supply zones (resistance) and Demand zones (support) are automatically drawn based on Fair Value Gaps (FVG) and specific candle configurations.
• Liquidation Levels: Traders can monitor how price reacts to specific depths within a zone. For example, setting the Liquidation Level to "Middle" helps identify when a zone has been 50% mitigated, which often signals a potential trend continuation or exhaustion.
• Volume Validation: Use the volume threshold feature to filter out weaker zones. Zones that meet the user-defined volume percentage will appear with more prominent background coloring, indicating higher market interest.
• Mitigation Tracking: When a zone is touched or "liquidated" according to the selected setting, the indicator can keep a visual record of these past levels, allowing traders to see historical areas of interest.

Details

The script utilizes lower timeframe volume data via request.security_lower_tf to calculate the "Delta Volume" within a zone's formation period. This allows for a more granular understanding of the buying and selling pressure that created the zone.

The logic for zone creation requires a specific sequence:

1. A "source" candle followed by a series of aggressive moves.
2. The presence of a Fair Value Gap (FVG) immediately following the source candle.
3. Confirmation that the zone has not been immediately mitigated by the subsequent candle.

Settings

Supply & Demand

• Show Supply & Demand: Toggles the visibility of all supply and demand zones.
• Liquidation Level: Determines the point at which a zone is considered "touched" or removed (1st Touch, Middle, or Fully).
• Show Volume: Displays the calculated volume percentage on the zone labels.
• Volume Threshold %: Filters zones based on the intensity of the volume delta.
• Active zones: Sets the maximum number of live zones to display on the chart.
• Liquidated zones: Sets the maximum number of historical, mitigated zones to keep on the chart for reference.

Colors

• Supply - Zone: Customize the color and transparency for supply (resistance) zones.
• Liquidation (Supply): Sets the color for supply zone liquidation lines and markers.
• Demand - Zone: Customize the color and transparency for demand (support) zones.
• Liquidation (Demand): Sets the color for demand zone liquidation lines and markers.

FAQ

How do I use the volume threshold?

The volume threshold allows you to highlight zones formed with significant delta volume. By increasing this value, you ensure that only the most "intense" supply and demand areas are visually prioritized.

What is the Liquidation Level?

This setting defines when a zone is removed from the "active" list. "1st Touch" removes it as soon as price enters the zone, "Middle" removes it at the 50% mark, and "Fully" requires price to trade entirely through the zone.

How can I access Ultra Supply & Demand?

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