Slope-Adaptive Moving Average for Trend and Consolidation Signals

Summary

This indicator combines an adaptive moving average with a slope calculation that colors the line to classify market conditions. Green denotes a strong upward trend, red a strong downward trend, and yellow a flat, choppy, or consolidating state. The adaptive average adjusts its responsiveness using recent price position within a lookback range; the slope component estimates direction and strength. Alerts are intended to mark transitions out of consolidation, while the author also describes entering during an established trend.

The published defaults include a 200-period adaptive average and slope settings of 34, 25, and a consolidation threshold of 17; the description recommends using the average on timeframes above one hour. A short BTC/USDT futures backtest window is listed, but no results or evaluation method are provided. The document warns implicitly through its chop classification that signals can be ambiguous near reversals. The shown source includes strategy orders, though the backtest settings alone do not establish profitability or robustness.

Key ideas

• The adaptive average changes its smoothing response based on the price range over its lookback.
• A calculated slope assigns bullish, bearish, or consolidation colors to the average.
• The described alerts signal trend direction changes as slope leaves the consolidation zone.
• The author recommends a long average length for higher timeframes.
• The listed backtest has no reported performance results.

Tags

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