Volatility Break Signals

Description:
The Volatility Break Signals is an indicator designed to detect potential trend changes while partially filtering market noise. It uses an adaptive volatility measure based on the selected price (Close, Open, High, Low, etc.) and generates Buy and Sell signals when the price shows a reversal relative to the previous direction.

How it works:

Price Volatility Measurement

• The indicator calculates the absolute price changes from bar to bar ( |price - previous price| ).

• An EMA of these variations creates a smoothed volatility.

Adaptive Filter

• A second EMA applies additional smoothing to create a “filter” around the price.

• The filter follows the overall price trend and ignores small fluctuations.

• The filter width can be adjusted using the Sensitivity parameter.

Reversal Detection

• The indicator tracks the current direction of the filter (upward or downward).

• A BUY signal appears when the price exceeds the filter and the previous trend was downward.

• A SELL signal appears when the price falls below the filter and the previous trend was upward.

Filtered Signals

• The Buy (green) and Sell (red) arrows appear after a change in filter direction, reducing some false signals.

• Sound alerts and push notifications can be enabled to follow the signals.

Summary

This indicator follows the price with an adaptive volatility-based filter and generates signals when the price shows a trend reversal. The signals are filtered but not guaranteed to be exact; they are meant to identify potential market movements.