What Is the Price Action Concepts Indicator?
Price Action Concepts is an indicator in the LuxAlgo suite that automatically detects and draws market structure, order blocks, fair value gaps and similar features. It automates the marking of concepts a trader would otherwise identify manually, and the identification still happens after the bars that define it.
Price Action Concepts automates the marking of structure on a chart. It is a capable tool with a name that contains a small contradiction worth noticing.
How it works
It is one indicator within the LuxAlgo suite, added to a TradingView chart like any other study, with its own settings panel.
It detects and draws a defined list of features — swing highs and lows, breaks of structure, changes of character, order blocks, fair value gaps, equal highs and lows.
Each has a rule behind it. A swing high is a high with lower highs either side; an order block is the last opposing candle before a move that broke structure. The rules are mechanical, which is what makes automating them possible.
The contradiction in the name
Price action, as a term, meant trading without indicators. The original argument was that the bars contain the information and everything layered on top is a derived, delayed version of it.
An indicator that draws price action concepts is therefore an odd object. Useful, certainly — and it reintroduces exactly the layer the approach was defined in opposition to.
That is not an argument against using it. It is an argument for knowing what you are using, because the name suggests you are doing one thing while the tool does another.
A worked example
Take this site’s shared series. Direction runs average 2.01 bars with a longest of 11, and the median bar range is 0.493 against a ninetieth percentile of 1.101.
A swing point needs bars either side to exist. So the indicator cannot mark a swing high until at least one bar has closed beyond it — the mark is always at least one bar late, by definition.
An order block is later still. It is identified retrospectively as the candle before a move that broke structure, which means it cannot be known until that break has happened.
None of that is a defect. It is what the definitions require. The important consequence is that a chart covered in these marks is a chart describing the past with more precision than it describes the right-hand edge.
What the settings actually change
Swing sensitivity sets how many bars either side define a pivot. A low number marks every wobble; a high one marks only major turns, later.
Order block filtering decides which qualifying candles are shown — all of them, or only those meeting additional volume or size conditions.
Gap detection thresholds set how large an imbalance must be before it counts as a fair value gap.
Each is a trade between quantity and lateness, and there is no setting that escapes it. At the sensitive end you get many marks, early and mostly meaningless; at the other, few marks, late and mostly real. Where you sit should follow your holding period rather than the default.
The original data
On this site’s shared series: median bar range 0.493, ninetieth percentile 1.101, largest bar 2.338. Direction runs average 2.01 bars with a longest of 11. A round trip costs 0.0098, about 2% of the median bar range.
A 2.01-bar average run is the reason sensitive settings produce clutter. A structure detector tuned to catch two-bar moves will mark nearly every bar, because nearly every bar is part of one.
And every mark acted on costs the spread. At 2% of a median bar per round trip, a chart producing dozens of zones a session is producing dozens of chances to pay it before any of them resolves.
Using it well
Set it deliberately rather than leaving the defaults. The defaults suit nobody in particular and were chosen to look reasonable on a screenshot.
Turn most of it off. Running every feature at once covers the chart; picking the two or three you actually use makes what remains readable.
Mark your own levels first, then compare. If the indicator agrees, you have confirmation of your reading; if it disagrees, you have a question worth examining. Reversing that order lets the tool do your thinking.
And treat it as a drawing aid. It renders a framework consistently and quickly. Whether that framework describes anything real is a separate question, answered by testing it — not by how convincing the finished chart looks.
When it fails
The characteristic failure is the chart that explains everything. Every feature is enabled, the screen carries dozens of labelled zones, and whatever price does next happens near one of them — so the tool appears to have called it. With enough marks on a chart, any outcome lands somewhere marked. That is not prediction, it is coverage, and it is very hard to notice from inside because each individual zone was correctly identified according to its own rule.
A second failure is treating a marked zone as a reason. The mark says a rule was satisfied, not that a trade is there.
A third is running it at maximum sensitivity, which produces marks faster than they can mean anything.
A fourth is believing the name. This is an indicator, with the lag every indicator has.
And a fifth is skipping the manual stage entirely. Somebody who has never marked structure by hand cannot tell when the automatic version is marking nonsense. The rules are mechanical, so the indicator applies them to noise exactly as confidently as it applies them to a real turn, and only a reader who knows what the concept is for can tell those two outputs apart.
Related
LuxAlgo covers the suite this belongs to. Price action trading covers the approach it is named after. And order block covers the feature it marks most often.
The name is the thing worth pausing on. Price action means reading the bars themselves — the original argument for it was that you did not need an indicator. An indicator that draws price action concepts for you is a useful tool and it is also, quite precisely, the opposite of what the phrase was coined to mean.
— Michael Whitman, from this video
This page is educational, not financial advice. Test every idea on your own charts before risking money.