Indicator ELTE SMART for TradingView

Description

This is an all-inclusive, premium indicator that focuses mainly on price action analysis, a form of looking at raw price data and market structure to analyze and capture areas of interest where price could react.

This indicator is a perfect trading companion that saves you a lot of time in trading price action. Some of the popular methods that use price action analysis are “Smart Money Concepts (SMC)”, “Inner Circle Trader (ICT)”, and “Institutional Trading”.

🔶 POWERFUL TOOLS

The indicator combines three main tools as a trading suite:

1. Trendlines
2. Market Structure Breakouts (MSB)
3. Order Blocks (OBs) and Reversal Order Blocks (ROBs)

These 3 main tools are interconnected together. Below we go over each, and then explain how and why they are brought in together. Please also note that the indicator’s settings have tooltips next to most of them, with more detailed information.

🔶 TRENDLINES

This indicator automatically draws the most relevant Trendlines from pivot high/pivot low (based on the defined settings) as origins, while keeping track of candle closes across these Trendlines to adjust or invalidate accordingly.

The indicator will draw all possible Trendlines up to the maximum allowed by TradingView’s PineScript. It uses a bullish pivot high candle to draw downtrends, and a bearish pivot low candle to draw uptrends. The algorithm will draw the most suitable active Trendlines from those origin points.

The indicator takes the origin point as the first point of the Trendline, then starts looking for the immediate next same-type candle (bullish to bullish or bearish to bearish), to draw the Trendline between the origin candle and this newer candle.

An uptrend is a ray connecting two bearish candles, as long as the second candle has a Low higher than the low of the origin (first) candle. A downtrend is a ray connecting two bullish candles, as long as the second candle has a high lower than the high of the origin (first) candle.

Upon drawing, the indicator then starts monitoring and adjusting this Trendline, by keeping the origin always the same but changing the second point. The goal is to keep reducing the slope of the Trendline till it is at 0 degrees (horizontal line). That then makes the Trendline “final”. Note that you have the option to keep all Trendlines or just show the final, in the settings.

So, the algorithm has three states for the Trendlines:

1. Initial: not tested, meaning price hasn’t yet broken through it and closed a candle beyond it, to cause a re-adjustment of this Trendline.
2. Broken: a candle hard closed (opened and closed) across it but still, the direction of the trend is maintained with a new Trendline from the same origin – could be replaced (or kept on the chart as a “backside”, which is what we call a broken Trendline to be tested from the opposite side) with a new Trendline from the same origin, to the newest candle that caused the break to happen, as then it becomes the new second point of that Trendline.
3. Final: a candle hard closed (opened and closed) across it and can’t draw a new Trendline from the same origin maintaining the direction of the trend (so an uptrend becomes a downtrend or a downtrend becomes an uptrend at this point, which is not allowed). This marks the end of the Trendline adjustment for that origin.

To summarize the Trendlines algorithm, imagine starting from a candle and drawing the Trendline, then keep re-adjusting it to make its slope less and less, till it becomes a horizontal line. That’s the final state.

Here is a step-by-step scenario to demonstrate the algorithm:

Notice how first an Uptrend (green ray) is drawn between point A origin pivot (picked by our smart algorithm) and point B, both marked by green arrows:

Uptrend then turned into backside (where it flips from diagonal support to resistance where liquidity potentially resides):