Institutional Zones MTF5 - Flow and Volume Confirmation

📌 Description

Institutional Zones MTF5 — Flow & Execution with Volume Confirmation
is a multi-timeframe institutional zone indicator designed to identify, validate and monitor high-probability Supply & Demand zones across multiple timeframes.

This script focuses on institutional price delivery, combining zone formation, mitigation tracking, multi-TF flow alignment and volume-based absorption confirmation to help traders evaluate where price interaction is meaningful.

🔍 How zones are detected

Zones are generated using an impulse-based displacement logic:

A strong impulsive candle (body ≥ ATR × multiplier) defines displacement

The last opposite candle prior to the impulse becomes the institutional zone

Zones are mapped and tracked across up to five timeframes simultaneously

Each zone is extended forward in time and dynamically monitored as price interacts with it.

🧠 Originality & Key Concepts

This indicator is not a basic Supply & Demand tool.
It introduces a layered logic architecture designed to reduce noise and highlight execution-grade interactions.

Key concepts include:

Mitigation tracking (X%)
Zones are visually marked as mitigated once price reaches a configurable percentage of the zone.

Overshoot-based invalidation
Zones are only deleted when price exceeds a configurable overshoot threshold (e.g. 110%), avoiding premature removal.

FLOW logic (formation near or inside parent zones)
Detects when a lower-timeframe zone forms close to or inside a higher-timeframe zone, suggesting alignment between timeframes.

EXECUTION logic (child inside parent + price interaction)
Execution alerts are triggered only when:

A child zone is located inside (or overlapping) its mapped parent zone

Price reaches or enters the parent zone

Volume confirmation (absorption filter)
Alerts can be filtered by volume expansion relative to a moving average, helping confirm real participation instead of weak reactions.

Cooldown system
Prevents alert spam during consolidations or clustered zone interactions.

This script was fully redesigned and restructured, introducing advanced interaction logic rather than simple zone plotting.

▶️ How to use

The indicator can be used in three complementary ways:

1️⃣ Proximity Alerts

Highlight moments when price approaches or enters institutional zones, optionally confirmed by volume.

2️⃣ FLOW Alerts

Signal when lower-timeframe zones form near or inside higher-timeframe zones, helping identify multi-TF alignment and directional bias.

3️⃣ EXECUTION Alerts

Execution-grade alerts occur only when structural and price-location conditions align, offering refined timing rather than blind signals.

📘 Practical Examples (Conceptual)

Example 1 — Proximity + Volume
If price approaches a higher-timeframe institutional zone and volume expands above its average, this may indicate active participation or absorption at that level.
This highlights an area of interest, not an automatic entry.

Example 2 — FLOW alignment
When a lower-timeframe zone forms near or inside a higher-timeframe zone, it suggests alignment between timeframes and may help confirm continuation or contextual bias.

Example 3 — EXECUTION scenario
An EXEC alert occurs only when:

A child zone is inside (or overlapping) its parent zone

Price reaches the parent zone

Optional volume confirmation is present

These conditions are designed to filter random reactions and focus on execution-quality interactions.

⚙️ Key Inputs

Impulse ATR Multiplier — displacement strength

Mitigation Percentage — when zones become mitigated

Overshoot Multiplier — zone invalidation threshold

Proximity Distance (%) — price-to-zone sensitivity

Volume Length & Multiplier — absorption confirmation

Inside / Overlap Mode — execution strictness

All parameters are configurable to adapt to different assets and trading styles.

⚠️ Notes & Limitations

This indicator does not predict market direction

Zones can fail, especially during high-volatility conditions

Best used with proper market context and risk management

Designed as a decision-support tool, not an automated trading system

📎 Disclaimer

This script is provided for educational and analytical purposes only.
It does not constitute financial advice or a recommendation to trade.