Adaptive Flow II | Anonycryptous

The Adaptive Flow II indicator tool provides a comprehensive adaptive trend-following system built around an advanced Kaufman Adaptive Moving Average (KAMA) that adjusts its sensitivity based on market efficiency. This framework combines dynamic stop engines, market structure detection, and multiple signal filters to provide a context-aware trading environment.

Usage

The Usage section describes how the script can be used to identify trend direction and structural shifts. The core of the tool is the "flow line," which accelerates toward price during efficient directional moves and flattens during volatile consolidation.

Stop Engine Modes

The stop engine determines where a trend flip occurs. Users can choose from five distinct modes:

• ATR Trailing: A smooth, ratchet-style stop that follows at a fixed ATR distance.
• Supertrend: An angular, step-like stop that reduces minor trend flips.
• Chandelier: Trails the highest or lowest flow line value over a specific lookback window.
• Donchian: A range-based stop that follows rolling highs or lows without volatility scaling.
• Volatility Pivot: Anchors the stop to confirmed pivot levels of the flow line with an ATR buffer.

Signal Filtering and Structure

Signals are generated when the flow line crosses the stop level. Users can refine these signals using:

• Macro Filtering: An EMA 200 filter ensures bullish signals only fire in uptrends and bearish signals in downtrends.
• Momentum/Direction: An ADX filter prevents signals during low-momentum ranging periods.
• Market Structure: The tool automatically detects Break of Structure (BOS) and Change of Character (CHoCH) events.
• Extension Bands: ATR-based bands help identify overextended conditions relative to the flow line.

Details

The script utilizes a Kaufman Adaptive Moving Average that calculates an Efficiency Ratio—the ratio of price displacement to total volatility over a lookback period.

• Noise Filter: A displacement gate ensures the flow line only advances if the price change exceeds a specific ATR threshold, preventing "churn" during low-activity periods.
• Visual Ribbon: The flow line is rendered with four stacked layers to create a "neon glow" effect, making the primary trend line highly visible.
• Structure Confirmation: To prevent false reversals, a BOS confirmation filter requires at least one continuation signal before a trend reversal (CHoCH) can be validated.
• VWAP Integration: A session-anchored VWAP provides intraday value reference points, reset daily or at custom session starts.

Settings

KAMA & Calculation

• Price Source: Determines the input price (e.g., Close, HL2).
• Adaptive Length: The efficiency ratio lookback period.
• Fast/Slow Constants: Controls the speed of smoothing for trending vs. ranging markets.
• Noise Threshold: The minimum ATR multiple required for the flow line to advance.
• Preset: Quickly switches between "Default," "Fast" (scalping), and "Smooth" (position trading) configurations.

Stop Engine & Structure

• Stop Mode: Selects the calculation method for the trailing stop.
• ATR Multiplier: Scales the distance of the stop from the flow line.
• Pivot Left/Right Bars: Sets the required confirmation bars for detecting swing highs and lows.
• BOS Required Before CHoCH: Number of trend confirmations needed before allowing a reversal signal.

Filters & VWAP

• EMA 200 Timeframe: Allows for macro filtering from higher timeframes.
• ADX Threshold: Minimum momentum required for a signal to trigger.
• Session Window: Restricts signal generation to specific trading hours.
• Signal Cooldown: Minimum bars required between consecutive signals.
• VWAP Session: Configures the reset interval (Daily or Custom).

FAQ

How do I interpret the flow line color and cloud? Green indicates a bullish adaptive trend, while red indicates a bearish trend. The width of the cloud between the flow line and the stop line represents current momentum; a narrowing cloud often precedes a trend shift.

What is the difference between BOS and CHoCH? A Break of Structure (BOS) occurs when price continues the existing trend. A Change of Character (CHoCH) occurs when price breaks a swing level in the opposite direction of the current trend, signaling a potential reversal.

How do I get access to Adaptive Flow II? You can get access on the LuxAlgo Library for charting platforms like TradingView, MetaTrader (MT4/MT5), and NinjaTrader for free.