Liquidity Zones

Liquidity Zones

Liquidity Zones is a price-action–based indicator designed to identify high-probability support and resistance areas where liquidity has historically accumulated.
Instead of drawing single lines, the script builds dynamic price zones based on repeated pivot reactions validated by volume, helping traders focus on meaningful levels rather than noise.

How It Works

Pivot Detection

The indicator scans historical price data for pivot highs and pivot lows using a fixed pivot strength.

Each pivot represents a potential liquidity interaction point.

Volume Qualification

A pivot is only considered valid if the volume at the pivot bar exceeds:

Volume SMA × Sensitivity


This filters out weak or low-participation levels and keeps zones formed during strong market interest.

Zone Construction

Nearby pivots are grouped into a single zone if their price difference stays within an ATR-based threshold.

Each time price reacts within this threshold, the zone’s touch count increases.

Once the minimum number of touches is reached, a liquidity zone is drawn and extended to the right.

Adaptive Zone Expansion

As new qualifying pivots appear, zones automatically expand to reflect the true liquidity range instead of staying static.

Dynamic Zone Coloring

Zones update their color in real time based on price position:

Green (Support) → Price is above the zone

Red (Resistance) → Price is below the zone

Gray (In-Zone) → Price is trading inside the zone

This allows instant visual feedback on whether a level is acting as support, resistance, or an active liquidity area.

Settings Overview

Bars to Apply
Controls how much historical data is scanned for liquidity zones.

Volume Sensitivity
Higher values require stronger volume spikes to validate pivots, resulting in fewer but higher-quality zones.

Styling Options
Fully customizable colors and transparency for support, resistance, and in-zone states.

Best Use Cases

Identifying high-liquidity support and resistance zones

Planning entries, exits, and stop placement

Combining with trend-following or momentum indicators

Filtering out weak levels in sideways or choppy markets