ICT/SMC DOL Detector PRO (Final)

This indicator is designed to operate only on the 1-hour timeframe.

The ICT/SMC DOL Detector PRO is an educational indicator designed to identify and visualize Draw on Liquidity (DOL) levels across multiple time-frames. It tracks unmitigated daily highs and lows, clusters them into zones, and calculates confidence scores based on multiple factors including time decay, cluster size, and time-frame alignment.

This indicator is based on ICT (Inner Circle Trader) concepts and liquidity theory, which suggests that price tends to seek out areas of concentrated unfilled orders before reversing or continuing its trend.

What is a DOL (Draw on Liquidity)?

A Draw on Liquidity represents a daily high or low that has not been revisited (mitigated) by price. These levels act as "magnets" that draw price toward them because:

1. They represent untapped liquidity pools where unfilled orders exist
2. Market makers and institutions often target these levels to fill large orders
3. Price is drawn to these zones to clear pending orders
4. They can serve as potential reversal or continuation zones once liquidity is taken

Methodology

1. Level Tracking
The indicator monitors daily session highs and lows on the 1-hour time-frame, tracking:
- Session high price and time of formation
- Session low price and time of formation
- Whether each level has been breached (mitigated)
- Time elapsed since level formation

2. Clustering Algorithm
Unmitigated levels within a defined tolerance (default 0.5% of price) are grouped together to identify zones where multiple DOLs cluster. Larger clusters indicate stronger liquidity pools.

3. Confidence Scoring (The "AI" Logic)
Each DOL receives a confidence score (0-100%) based on three weighted factors. This is the core "AI" intelligence of the indicator:

**Factor 1: Cluster Size (50% weight)**
- Counts how many unmitigated levels exist within 0.5% of the price zone
- Formula: (levels_in_cluster / total_unmitigated_levels) × 50
- Logic: More unfilled orders clustered together = stronger liquidity pool = higher confidence
- Example: If 5 out of 10 total unmitigated levels cluster at 27,500, cluster score = (5/10) × 50 = 25%

**Factor 2: Time Decay (25% weight)**
- Calculates age of the level since formation
- Fresh levels (< 1 week old): Full 25% score
- Aging penalty: Loses 5% per week of age
- Maximum penalty: 25% (very old levels = 0% time score)
- Formula: max(0, 25 - (weeks_old × 5))
- Logic: Recent liquidity is more relevant than old liquidity that price has ignored for months

**Factor 3: Timeframe Alignment (25% weight)**
- Checks how many timeframes (1H, 4H, D1, W1) point in the same direction
- If multiple timeframes identify DOLs on the same side (all bullish or all bearish): Higher score
- If mixed signals: Lower score
- Formula: (aligned_timeframes / total_timeframes) × 25
- Logic: When multiple timeframes agree, the liquidity zone is validated across different time perspectives

**Total Confidence Score:**
```
Confidence = Cluster_Score + Time_Score + Alignment_Score
= (0-50%) + (0-25%) + (0-25%)
= 0-100%
```

**Example Calculation:**
```
DOL at 27,500:
- 6 out of 12 unmitigated levels cluster here → (6/12) × 50 = 25%
- Level is 2 weeks old → 25 - (2 × 5) = 15%
- 3 out of 4 timeframes bullish toward this level → (3/4) × 25 = 18.75%
- Total Confidence = 25% + 15% + 18.75% = 58.75% ≈ 59%
```

This mathematical approach removes subjectivity and provides objective, data-driven confidence scoring.

4. Multi-Timeframe Analysis
The indicator analyzes DOLs across four timeframes:
- **1H:** Intraday levels (fastest reaction)
- **4H:** Short-term swing levels
- **Daily:** Intermediate-term levels
- **Weekly:** Long-term structural levels

For each timeframe, it identifies:
- Highest confidence unmitigated high
- Highest confidence unmitigated low
- Directional bias (bullish if high > low confidence, bearish if low > high confidence)

5. Primary DOL Selection (AI Auto-Selection Logic)
When "Show AI DOL" is enabled, the indicator uses an automated selection algorithm to identify the most important targets:

**Step 1: Collect All Candidates**
The algorithm gathers all identified DOLs from all timeframes (1H, 4H, D1, W1) that meet minimum criteria:
- Must be unmitigated (not yet swept)
- Must have confidence score > 0%
- Must have at least 1 level in cluster

**Step 2: Calculate Confidence for Each**
Each candidate DOL receives its confidence score using the three-factor formula described above (Cluster + Time + Alignment).

**Step 3: Sort by Confidence**
All candidates are ranked from highest to lowest confidence score.

**Step 4: Select Primary and Secondary**
- **P1 (Primary DOL):** The DOL with the absolute highest confidence score
- **P2 (Secondary DOL):** The DOL with the second highest confidence score

**Why This Matters:**
Instead of manually scanning multiple timeframes and guessing which level is most important, the AI objectively identifies the two highest-probability liquidity targets based on quantifiable data.

**Example AI Selection:**
```
Available DOLs:
- 1H High: 27,400 [87%]
- 4H High: 27,500 [84%]
- D1 High: 27,500 [92%] ← P1 (Highest)
- W1 High: 27,650 [88%] ← P2 (Second Highest)
- 1H Low: 26,800 [65%]
- D1 Low: 26,500 [72%]

AI Selection:
P1 = 27,500 (Daily High with 92% confidence)
P2 = 27,650 (Weekly High with 88% confidence)
```

This provides a data-driven target selection rather than subjective manual interpretation. The AI removes emotion and bias, selecting targets based purely on mathematical probability.

Features

Why "AI" DOL?

The term "AI" in this indicator refers to the automated algorithmic selection process, not machine learning or neural networks. Specifically:

**What the AI Does:**
- Automatically evaluates all available DOLs across all timeframes
- Applies a weighted scoring algorithm (Cluster 50%, Time 25%, Alignment 25%)
- Objectively ranks DOLs by probability
- Selects the top 2 highest-confidence targets (P1 and P2)
- Removes human bias and emotion from target selection

**What the AI Does NOT Do:**
- It does not use machine learning or train on historical data
- It does not predict future price movements
- It does not adapt or "learn" over time
- It does not guarantee accuracy

The "AI" is simply an automated decision-making algorithm that applies consistent mathematical rules to identify the most statistically significant liquidity zones. Think of it as a "smart filter" rather than artificial intelligence in the traditional sense.

Visual Components

**Daily Level Lines:**
- Green lines: Unmitigated (not yet breached) levels
- Red lines: Mitigated (already breached) levels
- Dots at origin point showing where level was formed
- X marker when level gets breached
- Lines extend forward to show projection

**DOL Labels:**
- Display timeframe (1H, 4H, D1, W1) or "DOL" for AI selection
- Show confidence percentage in brackets [XX%]
- Color-coded by timeframe:
- Lime: AI DOL (Smart selection)
- Aqua: 1-hour timeframe
- Blue: 4-hour timeframe
- Purple: Daily timeframe
- Orange: Weekly timeframe

**Info Box (Top Right):**
Displays comprehensive liquidity metrics:
- Total levels tracked
- Active (unmitigated) levels count
- Cleared (mitigated) levels count
- Flow direction (BID PRESSURE / OFFER PRESSURE)
- Most recent sweep
- Primary and Secondary DOL targets
- Multi-timeframe bias analysis
- Overall directional bias

Settings Explained

**Daily Levels Group:**
- Show Daily Highs/Lows: Toggle visibility of all daily level tracking
- Unbreached Color: Color for levels not yet hit
- Breached Color: Color for levels that have been swept
- Show X on Breach: Display marker when level is breached
- Show Dot at Origin: Display marker at level formation point
- Line Width: Thickness of level lines (1-5)
- Line Extension: How many bars forward to project (1-24)
- Max Days to Track: Historical lookback period (5-200 days)

**DOL Settings Group:**
- Cluster Tolerance %: Price range to group DOLs (0.1-2.0%)
- Show Price on Labels: Display actual price value on labels
- Backtest Mode: Only show recent labels for clean historical analysis
- Labels Lookback: Number of bars to show labels when backtesting (10-500)

**Info Box Group:**
- Show Info Box: Toggle info panel visibility

**DOL Toggles Group:**
- Show AI DOL: Display smart auto-selected primary target
- Show 1HR DOL: Display 1-hour timeframe DOLs
- Show 4HR DOL: Display 4-hour timeframe DOLs
- Show Daily DOL: Display daily timeframe DOLs
- Show Weekly DOL: Display weekly timeframe DOLs

**Advanced Group:**
- Manual Mode: Simplified display showing only daily high/low clusters

How to Use This Indicator

Educational Application

This indicator is intended for educational purposes to help traders:

1. **Understand Liquidity Concepts:** Visualize where unfilled orders may exist
2. **Identify Key Levels:** See where price may be drawn to
3. **Analyze Market Structure:** Understand how price interacts with liquidity
4. **Study Multi-Timeframe Alignment:** Observe when multiple timeframes agree
5. **Learn ICT Concepts:** Apply liquidity theory in practice

Interpretation Guidelines

**BID PRESSURE (Flow):**
When lows are being swept more than highs, it suggests:
- Sell-side liquidity being taken
- Potential for upward move to unfilled buy-side liquidity
- Market may be clearing the way for a bullish move

**OFFER PRESSURE (Flow):**
When highs are being swept more than lows, it suggests:
- Buy-side liquidity being taken
- Potential for downward move to unfilled sell-side liquidity
- Market may be clearing the way for a bearish move

**Confidence Scores:**
- 90-100%: Very high probability zone (strong cluster, recent, aligned)
- 80-89%: High probability zone (good cluster, relatively recent)
- 70-79%: Moderate probability zone (decent cluster or older)
- 60-69%: Lower probability zone (small cluster or very old)
- Below 60%: Weak zone (minimal confluence)

**Timeframe Analysis:**
- All timeframes LONG: Strong bullish alignment
- All timeframes SHORT: Strong bearish alignment
- Mixed: Conflicting signals, exercise caution
- Higher timeframes (D1, W1) carry more weight than lower (1H, 4H)

**DIRECTIONAL Indicator:**
- BULLISH: Overall bias suggests upward movement toward buy-side DOLs
- BEARISH: Overall bias suggests downward movement toward sell-side DOLs
- NEUTRAL: No clear directional bias, conflicting signals

Practical Application Examples

**Example 1: Bullish Setup**
```
Flow: BID PRESSURE (lows being swept)
P1: 27,500 [92%] (price above current market)
D1: LONG 27,500 [92%]
W1: LONG 27,650 [88%]
DIRECTIONAL: BULLISH
```
Interpretation: Price has cleared sell-side liquidity. High confidence buy-side DOL at 27,500. Daily and Weekly timeframes aligned bullish. Watch for move toward 27,500 target.

**Example 2: Bearish Setup**
```
Flow: OFFER PRESSURE (highs being swept)
P1: 26,200 [85%] (price below current market)
D1: SHORT 26,200 [85%]
W1: SHORT 26,100 [81%]
DIRECTIONAL: BEARISH
```
Interpretation: Price has cleared buy-side liquidity. High confidence sell-side DOL at 26,200. Daily and Weekly timeframes aligned bearish. Watch for move toward 26,200 target.

**Example 3: Mixed Signals - Wait**
```
Flow: BID PRESSURE
P1: 26,800 [65%]
D1: LONG 27,000 [68%]
W1: SHORT 26,200 [72%]
DIRECTIONAL: NEUTRAL
```
Interpretation: Conflicting signals. Flow suggests up, but Weekly bias is down. Confidence scores moderate. Better to wait for clarity.

Important Considerations

This Indicator Does NOT:
- Predict the future
- Guarantee profitable trades
- Provide buy/sell signals
- Replace proper risk management
- Work in isolation without other analysis

This Indicator DOES:
- Visualize liquidity concepts
- Identify potential target zones
- Show timeframe alignment
- Calculate objective confidence scores
- Help understand market structure

Proper Usage:
1. Use as one component of a complete trading strategy
2. Combine with price action analysis
3. Confirm with other technical indicators
4. Consider fundamental factors
5. Always use proper risk management
6. Backtest any strategy before live trading

Risk Disclaimer

**FOR EDUCATIONAL PURPOSES ONLY**

This indicator is for educational purposes only. Trading financial markets involves substantial risk of loss. Past performance does not guarantee future results. Always conduct your own research and consult with a financial advisor before making trading decisions.

**Important Limitations:**
- No indicator is 100% accurate, including the AI selection
- The "AI" is an automated algorithm, not predictive artificial intelligence
- DOL levels can be swept and price can continue in the same direction
- Confidence scores are mathematical calculations, not predictions or probabilities of success
- High confidence does not mean guaranteed profit
- Markets can remain irrational longer than you can remain solvent
- Always use stop losses and proper position sizing

**Understanding the AI Component:**
The AI auto-selection feature uses a fixed mathematical formula to rank DOLs. It does not:
- Predict where price will go
- Learn from past performance
- Adapt to market conditions
- Guarantee any level of accuracy

The confidence score represents the mathematical strength of a liquidity cluster based on objective factors (cluster size, recency, timeframe alignment), NOT a probability of the trade succeeding.

**Risk Warning:**
Trading is risky. Most traders lose money. This indicator cannot change that fundamental reality. Use it as an educational tool to understand market structure, not as a trading signal or system.

Technical Requirements

- **Timeframe:** Best used on 1-hour charts (required for accurate daily level tracking)
- **Markets:** Works on any market (forex, crypto, stocks, futures, indices)
- **Updates:** Real-time calculation on each bar close
- **Resources:** Uses max 500 lines and 500 labels (TradingView limits)

Backtesting Features

The indicator includes "Backtest Mode" to keep historical charts clean:
- When enabled, only shows labels from recent bars
- Adjustable lookback period (10-500 bars)
- All lines remain visible
- Helps review past setups without clutter

To use:
1. Enable "Backtest Mode" in settings
2. Adjust "Labels Lookback" to desired period
3. Review historical price action
4. Disable for live trading

Credits and Methodology

This indicator implements concepts from:
- ICT (Inner Circle Trader) liquidity theory
- Smart Money Concepts (SMC)
- Order flow analysis
- Multi-timeframe analysis principles

The clustering algorithm, confidence scoring, and timeframe synthesis are original implementations designed to quantify and visualize these concepts.

Version History

**v1.0 - Initial Release**
- Multi-timeframe DOL detection
- Confidence scoring system
- Info box with liquidity metrics
- Backtest mode for clean charts
- Black/white professional theme

Support and Updates

For questions, feedback, or suggestions, please use the TradingView comments section. Updates and improvements will be released as needed based on user feedback and market evolution.



**Remember:** This is an educational tool. Successful trading requires knowledge, discipline, risk management, and continuous learning. Use this indicator to enhance your understanding of market structure and liquidity, not as a standalone trading system.