Forex Kill Zones - SMC Indicators

23 Jan

What are Kill Zones?

Kill Zones are specific Time Windows of opportunity during the Session that have the potential for the highest volatility and where looking for trading opportunities is ideal.

The Forex Kill Zone Indicator is specifically designed for the Forex Market. What differentiates this script from other Kill Zones scripts is that this script is based on NY Midnight as the basis for the start of the day.

This is not the usual below-average Kill Zone indicator because this indicator does not only show the 3 main Kill Zones or Sessions, but it also offers extra Kill Zones that are called "Asian Range (AR)", "Central Bank Dealing Range (CBDR)", and "FLOUT".

Another key differentiator of this indicator's functionality is that it shows the highs and lows of each Kill zone allowing SMC traders to monitor Time-Based Liquidity above the highs and lows of each trading session.

Another added benefit of this indicator is the Standard Deviations features for the AR, CBDR, and FLOUT that we added. The Standard Deviations act as key levels where there is a high probability of price reacting when in confluence with 1H or higher key levels (PD Arrays). The Standard Deviations are not pivot levels but are ranges above and below the Kill Zones that rely on TIME and PRICE in their calculations.

Finally, we have also incorporated a Notification function to remind the trader of the start of the trading Kill Zones to not miss out on potential trade opportunities.

Key Functionalities

1) Universal Time Reference:

Every day starts at 00:00 NY Midnight, irrespective of the trader's local time, Instead of the Standard GMT Midnight. This allows all Kill Zones to be in line with the New York start of the day at Midnight, as thought by ICT.


Weekend Highlighter

This feature highlights time from Sunday Market Open at 5 PM NY Time to 00:00 NY Midnight.

It's useful for identifying the non-trading or the low volatility periods when trading should be avoided.

https://www.tradingview.com/x/hmLNbSw6/


Features Breakdown

Lookback Period

• Defaulted to 60 trading days, aligning with “IPDA Data Ranges”, which is ideal for backtesting.
  
• Adjustable for trading, and it's recommended to keep it at 20 trading days to focus on most recent data only.
  

24-hour Daily Intervals

• The 24-hour intervals are not the same as the usual daily candle. Instead, the start of each trading day is anchored to the 00:00 NY Midnight.
  
• Highlights "Days of the Week" labels, "Weekend" Trading Time, and the daily high-low ranges based on the start of trading day mark being at 00:00 NY Midnight.
  

London Kill Zone (Green)

• Starts from 01:00 NY Time to 05:00 NY Time.
  
• London closes at 12:00 NY Time.
  
• Highlight the high and low of the London Kill Zone to Identify Time-Based Liquidity above and below the London Kill Zone Range.
  
• Marks the London Close Session to mark the end of London End of the trading day, where volatility drops.
  

Highlights the time when there is the highest volatility during the London Session Kill Zone.

https://www.tradingview.com/x/RKydQsK6/


New York Kill Zone (Blue)

• Starts from 07:00 NY time to 10:00 NY Time.
  
• Marks The CME Open at 08:30 (the opening of the Bond Market).
  
• Highlight the high and low of the New York Kill Zone to Identify Time-Based Liquidity above and below the NY Kill Zone Range.
  

Highlights the time when there is the highest volatility during the New York Session.

https://www.tradingview.com/x/IH1751f7/


The Central Bank Dealing Range or "CBDR" (Orange)

• Starts From 14:00 NY Time to 20:00 NY Time.
  
• Highlight the high and low of the CBDR Kill Zone to Identify Time-Based Liquidity above and below the CBDR Kill Zone Range.
  
• Also, there is an added ability to add the CBDR Standard Deviations above and below the CBDR.
  
• Can also extend the CBDR Standard Deviations key levels until the end of the next day's London Kill Zone.
  

What are the CBDR Standard Deviations?

The Standard Deviations are extensions of the CBDR above and below the CBDR original range. It takes the high and low of the range and adds the range above and below the original range by x times.

The CCBDR Standard Deviations are NOT pivot levels. They are used as points of reference where we could expect the price to react when in confluence with higher timeframe reference points.

The idea behind them is that if the price is Bearish, the price could rally to +1 CBDR Standard Deviation below dropping lower. As shown in the image below on Thursday, the two vertical lines before the start of Thursday mark the CBDR Kill Zone, then the price rallied to +1 CBDR SDv and then dropped.

https://www.tradingview.com/x/CklcOLDf/


Asian Range "AR" Kill Zone

• Starts from 20:00 NY Time to 00:00 NY Time.
  
• Highlight the high and low of the AR Kill Zone to Identify Time-Based Liquidity above and below the AR Kill Zone Range.
  
• Also, there is an added ability to add the AR Standard Deviations above and below the AR.
  
• This KillZone should be primarily used when CBDR exceeds 40 pips.
  
• Similar to the CBDR, the AR Standard Deviations also can be used as points of reference where we could expect the price to react when in confluence with higher timeframe reference points.
  
• The AR Standard Deviations can also be extended until the end of the next day's London Kill Zone.
  

https://www.tradingview.com/x/GlGTXUg0/


FLOUT Range

• It Combines AR and CBDR, spanning from 14:00 NY Time to 00:00 NY Time.
  
• The FLOUT should only be used when both AR and CBDR have small ranges of less than 10 pips combined.
  
• Highlight the high and low of the FLOUT Kill Zone to Identify Time-Based Liquidity above and below the FLOUT Kill Zone Range.
  
• The FLOUT Standard Deviations also can be used as points of reference where we could expect the price to react when in confluence with higher timeframe reference points.
  
• The Flout Standard Deviations can be extended until the end of the next day London Kill Zone.
  

https://www.tradingview.com/x/KM6qysV8/


Bonus Features

Daily & Weekly Open Price Levels

The Open Price levels draw a horizontal line from the start of the trading day at 00:00 NY midnight, and it extends it towards the end of the trading day.

This is useful for understanding where the price is relative to the daily candle.

• When Bullish, the trader should look for setups at or below the daily or weekly open price.
  
• When Bearish, the trader should look for setups at or above the daily or weekly open price.
  

Whether to choose the Daily or Weekly open price depends on the trader's trading style. If the trader is day trading or scaling, then it's more appropriate to choose the Daily Open Price.

However, Day Traders can also use the Weekly candle to align with the Weekly Candle's expected range direction.

On the other hand, if the trader is a Swing Trader and wants to capitalise on the weekly candle's trend, then it's more appropriate to choose the Weekly Open Price.

However, Swing Traders can also use the Daily Open Price when looking to take a trade to time better entries with a high risk-to-reward ratio.

https://www.tradingview.com/x/Oi0LXDsL/


Notifications

The trader can also receive alerts as a reminder at the start of the desired session to not miss out on the start of the trading session.