72s: Adaptive Hull Moving Average+

The 72s: Adaptive Hull Moving Average+ indicator provides a dynamic trend-following tool that automatically adjusts its lookback period based on market volume or volatility to filter noise and identify high-probability trend phases.

Usage

The script serves as a multi-functional tool for identifying trend strength, consolidation zones, and potential entries or exits. It is primarily used to distinguish between trending environments and choppy price action.

• Trend Identification: Users can look at the color of the HMA to determine market state. Darker colors signify strong trends supported by volume or volatility, while lighter colors indicate weakening trends or low-momentum environments.
• Entry Signals: A common strategy involves entering a long position when the price is above the MA, the RSI is above 50, and the HMA turns dark green. Conversely, short entries are considered when the price is below the MA and the HMA turns dark red.
• Support and Resistance: The adaptive nature of the MA allows it to act as a more responsive dynamic support or resistance level during volatile periods while smoothing out during flat markets.
• Consolidation Filtering: The yellow (flat) color indicates sideways movement. Traders may use this to avoid "choppy" markets where stop-losses are frequently triggered.

Details

The indicator utilizes Pine Script’s dynamic length capabilities to modify the HMA period in real-time. Unlike a static HMA, this version shifts its period between a defined minimum and maximum range based on a "Charger" input.

• Adaptive Logic: When the chosen charger (Volume or Volatility) is active, the script shortens the MA period (using an adaptation percentage) to make it more reactive. When market activity is low, the period lengthens to provide a smoother, less reactive line.
• Slope Calculation: The tool incorporates a slope algorithm to measure the angle of the MA. This angle determines if the market is trending or consolidating based on a user-defined threshold.
• Minor HMA: An optional secondary, faster adaptive HMA is included to provide earlier exit signals or to visualize short-term momentum shifts against the primary trend.
• Distance Zones: The script includes an envelope system based on Average True Range (ATR) to visualize overextended price conditions and potential reversal zones.

Settings

• Charger: Selects the data source (Volatility or Volume) that dictates how the HMA adapts its length.
• Source: Determines the price data (e.g., Close, HL2) used for the HMA calculation.
• Minimum Period / Maximum Period: Defines the range within which the HMA length can fluctuate. Smaller ranges result in more static behavior.
• Consolidation area threshold: Sets the slope degree required to classify the market as trending versus flat.
• Show minor xHMA+: Toggles the visibility of a secondary, shorter-period adaptive HMA.
• Show Adaptive HMA+ Distance Zone: Enables ATR-based bands around the main HMA to identify overextension.
• Show Possible Signals: Displays visual icons for Buy, Sell, Exit, and Warning conditions on the chart.
• Background coloring: Highlights different market phases using background tints for easier visual scanning.

FAQ

How do I interpret the different colors on the moving average? Dark green/red indicates strong trends with high volume or volatility. Light green/red indicates a trend exists but lacks momentum. Yellow or gray indicates a consolidation or flat market.

Can I use this for intraday trading? Yes, the script is optimized for intraday timeframes like the 15m or 1H, but the minimum and maximum periods can be adjusted to suit higher timeframes or different asset classes.

How do I get access to the 72s: Adaptive Hull Moving Average+? You can get access on the LuxAlgo Library for charting platforms like TradingView, MetaTrader (MT4/MT5), and NinjaTrader for free.