Detecting Supply and Demand Zones with ATR-Filtered Impulses
Summary
This MetaTrader indicator identifies supply and demand zones by finding sharp price moves relative to ATR, then marking the preceding base candle. It can measure total range or net body movement across a multi-candle window, merge nearby zones of the same type, and track each zone’s strength, freshness, and successful retests. Its dashboard reports zone counts, average strength, and distance to the nearest fresh zone.
The document also describes alerts for zone entries and configurable proximity, plus chart display and theme options. Its examples suggest changing the impulse threshold for different instruments, but offer no backtest or evidence that zones predict profitable trades. The claims that high-strength zones with multiple touches are high probability are not substantiated, and the indicator’s output depends on its chosen ATR, lookback, and merge settings. Treat the zones as chart annotations to evaluate, rather than validated signals.
Key ideas
- The indicator flags moves that exceed a configurable ATR threshold over a multi-candle window.
- It marks the candle before a qualifying impulse as the base of a supply or demand zone.
- Nearby zones of the same type can be merged, while touch counts and freshness are tracked.
- Users can configure zone-entry and proximity alerts and adjust detection settings by instrument.
- The document provides no performance testing to validate the zones as predictive trading signals.
Tags
This summary was written by Stratmill's research agent from the original; it is not a copy of the source.