Volume Anchored Price Map [LuxAlgo]

The Volume Anchored Price Map indicator is a sophisticated institutional-grade tool designed to visualize where the highest concentration of trading activity is occurring relative to current price action.

By combining statistical volume analysis through dynamic "Bubbles" with a retrospective Volume Profile, it allows traders to identify high-interest liquidity zones and potential institutional support/resistance levels.

🔶 USAGE

The indicator provides a multi-layered view of market activity, helping traders distinguish between standard price movement and high-conviction institutional participation.

🔹 Identifying Institutional S/R

The projected dashed lines with TIER labels act as a roadmap for liquidity. Institutions often defend positions at these high-volume price points. When price returns to a TIER I level, traders should expect a significant reaction, either in the form of a strong reversal or a high-momentum breakout.

🔹 Spotting Absorption and Exhaustion

Large bubbles often signal the end of a move or the beginning of a major shift:

• Exhaustion: Large red bubbles at the end of a downtrend suggest sellers are throwing in the towel (climax).
  
• Absorption: Large green bubbles at the top of an uptrend can indicate institutional absorption of supply or a "blow-off" top.

🔹 Market Speed and the Value Area

The Price Map profile reveals the "thickness" of the market at specific prices:

• High Volume Nodes (Wide/Bright Bars): Expect price to slow down and consolidate. These are "sticky" areas where the market is comfortable.
  
• Low Volume Areas (Thin Bars): Price often moves through these zones rapidly due to a lack of historical interest, facilitating fast breakouts.

🔶 HOW TO USE

Traders can utilize the Volume Anchored Price Map to identify high-probability entries based on where "smart money" has previously transacted.

• Filter Price Action: Look for TIER I or TIER II levels that align with the widest bars (High Volume Nodes) of the Price Map Profile. These confluences mark the strongest historical "Fair Value" zones.
  
• Wait for Mean Reversion: If price deviates far from the High Volume Nodes into a "Low Volume Area" and a large Volume Bubble appears, it often indicates an exhaustion point where price is likely to snap back toward the high-volume center.
  
• Breakout Confirmation: Use the levels as a breakout filter. A candle closing decisively above or below a projected TIER level—accompanied by a new Volume Bubble—suggests institutional participation in the new direction.

🔶 DETAILS

🔹 Price Map (The Gradient Histogram)

The tool looks back at a user-defined lookback window and calculates the total volume traded at every price bin. It displays this as a heatmap anchored to the right. Brighter, wider bars represent High Volume Nodes (HVN) where the market has found significant value or spent considerable time.

🔹 Volume Bubbles (Z-Score Analysis)

Instead of using raw volume, the script utilizes a Z-Score (a statistical measure of standard deviations from the mean). When volume spikes significantly above the average, a bubble is placed on the price action. The bubble size scales dynamically based on its statistical intensity (Z-Score), ranging from "Tiny" to "Huge."

🔹 Projected Anchor Levels

When a significant volume bubble is detected, the script "anchors" that price level and projects it forward. These levels are categorized by importance:

• TIER I (Extreme): Massive liquidity events (> 6 standard deviations). Major structural significance.
  
• TIER II (High): Strong institutional interest (4 to 6 standard deviations).
  
• TIER III (Significant): Noteworthy volume spikes (2 to 4 standard deviations).

🔶 SETTINGS

🔹 Price Map Profile

• Lookback Length: Determines the historical window used to calculate the volume profile and identify bubbles.
  
• Price Bins: The vertical resolution of the profile. Higher values create a more detailed histogram.
  
• Show Price Map Profile: Toggles the visibility of the volume heatmap.
  
• Profile Color: Sets the base color for the volume profile gradient.

🔹 Volume Bubbles

• Show Volume Bubbles: Toggles the visibility of the Z-Score based circles.
  
• Bubble Sensitivity (Z-Score): The threshold at which a volume spike is considered significant enough to display.
  
• Project Levels from Bubbles: Enables the projection of horizontal dashed lines from significant bubbles.
  
• Max Projected Levels: Limits the number of active anchor levels displayed on the chart.
  
• Label Horizontal Offset: Adjusts the position of the TIER labels to prevent overlap with the profile.

🔹 Dashboard

• Enable Dashboard: Toggles the data table showing lookback, POC (Max Vol Level), and current Z-Score.
  
• Position/Size: Controls the visual placement and scale of the dashboard on the chart.