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Institutional Liquidity and Price Action Concepts

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Introduction

Designed for efficiency, the ILPAC™ script delivers key insights into price action and liquidity through four powerful tools: Market Structure, Liquidity Heatmap, Trend Lines, and FOMO Bubbles. This all-in-one indicator empowers traders to customize their analysis, whether they’re scalping or managing long-term positions. With advanced algorithms and flexible settings, Institutional Liquidity and Price Action Concepts™ is a comprehensive solution for navigating complex markets with precision.

SETTINGS REFERANCE  ⚙️

Market Structure Component

  • Feature: Automatically identifies swing highs and lows, marking trends with Higher Highs (HH), Higher Lows (HL), Lower Highs (LH), and Lower Lows (LL). It also detects Change of Character (CHoCH) and Break of Structure (BOS) patterns, providing an easy-to-read visual representation.

  • Usage: Use this component to spot the overall market trend. Traders can enter positions during a CHoCH (trend reversal) or a BOS (trend continuation), setting stop-losses and take-profits based on these levels.

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Liquidity Heatmap Component

  • Feature: Provides a 3D visual of market liquidity, indicating zones with high or low liquidity. It maps out where large volumes of orders are concentrated.

  • Usage: Use the Liquidity Heatmap to identify potential support and resistance levels. High liquidity zones can signal where price may stall or reverse, making this feature useful for setting exit points or anticipating reversals.

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Trend Lines Component

  • Feature: Automatically draws trend lines connecting significant price highs and lows, indicating market direction. It includes a noise filter to remove false signals.

  • Usage: Utilize the Trend Lines component to confirm market direction and identify breakout signals. Traders can enter positions when the price breaks a trend line, with the noise filter ensuring only valid breakouts are shown.

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FOMO Bubbles Component

  • Feature: Identifies bubbles of impulsive market activity driven by Fear of Missing Out (FOMO), highlighting potential overbought or oversold conditions.

  • Usage: Monitor FOMO Bubbles for signs of market exuberance or panic. Use this component to time exits during periods of extreme market activity, or to take advantage of short-term trading opportunities.

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Usage Examples

  1. Trend Trading:

    • Enter a trade when a CHoCH or BOS pattern is detected using the Market Structure component.

    • Set take-profits (TP) at key liquidity areas using the Liquidity Heatmap to maximize returns.

    • Confirm trend direction and breakouts using the Trend Lines component for additional confidence.

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2. Reversal Trading:

  • Identify potential reversal zones with the Liquidity Heatmap by looking for rejections at key liquidity levels.

  • Use the Trend Line Breakout signals as additional confluence for entry points.

  • Set exits by monitoring FOMO Bubbles for signs of market exhaustion.

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Settings

  • Market Structure Time-Horizon: Controls the time horizon used by the indicator to determine market structure. A larger number looks at longer-term market structure, while a smaller number shows shorter-term market structure.

  • BOS Confirmation Type: Choose whether the candle close/wick above previous swing point counts as a Break of Structure (BOS).

  • CHoCH/BOS Line Style: The line style for marking out the broken swing levels during a Change of Character (CHoCH) or BOS. This is purely aesthetic and does not affect calculations.

  • Heatmap Look-Back: Determines the time horizon the indicator will use to make the Heatmap. A larger number marks longer-term liquidity, while a smaller number gives shorter-term liquidity.

  • Resolution (Heatmap): A higher resolution will give a more detailed gradient but will also take longer to load. Reduce this if the indicator fails to load.

  • Trend Lines Look-Back: The time horizon the indicator will use to detect trend lines. A higher value detects longer-term trend lines.

  • Noise Filter Factor (Trend Lines): Controls the width (buffer zone) of the trend line. A higher value increases the width and prevents more false breakouts, but detects real breakouts slower.

  • FOMO Look-Back: The look-back window to determine if the market is in FOMO. A higher value gives fewer bubbles, and vice versa.

  • Noise Filter Factor (FOMO Bubbles): Controls the sensitivity of FOMO detection. A higher value reduces noise and decreases detection sensitivity.

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