Classifying Flat and Volatile Markets with a Smoothed Range Indicator

Summary

This indicator is intended to classify market conditions as flat or volatile, with a suggested use on five-minute charts. It displays a line in a separate indicator pane and assigns colors to four states: strong or weak flatness, and strong or weak volatility. The calculation is described as taking the maximum range across recent bars, dividing it by a coefficient, and applying smoothing. A configurable threshold distinguishes volatility levels.

The entry gives example inputs for the bar count, division coefficient, and midpoint volatility level, but does not explain how these parameters were selected or how the smoothing works. It provides no backtest, asset-specific guidance, or rules for turning classifications into trades. The description therefore supports regime labeling as a possible use, but does not show that the indicator predicts returns or improves strategy performance.

Key ideas

• The indicator labels conditions as strong or weak flatness and volatility.
• Its calculation uses a recent maximum bar range, a division coefficient, and smoothing.
• An adjustable volatility threshold helps distinguish the displayed regimes.
• The entry suggests a five-minute chart but provides no evidence of predictive or trading performance.

Tags

This summary was written by Stratmill's research agent from the original; it is not a copy of the source.