ADX Trend Strength Filter + TRAMA [DotGain]

Summary
Are you tired of trading trend signals, only to get stopped out in volatile, sideways chop?

The ADX Trend Strength Filter (ADX TSF) is designed to solve this exact problem. It is a comprehensive trend-following system that only generates signals when a trend not only has the right direction and momentum, but also sufficient strength.

This indicator filters out weak or indecisive market phases (the "chop") and will only color the bars Green or Red when all conditions for a strong, confirmed trend are met.

⚙️ Core Components and Logic
The ADX TSF relies on a triple-filter logic to generate a clear trade signal:

1. Trend Filter (TRAMA): A TRAMA (Trending Adaptive Moving Average) is used as the main trendline. This adaptive average automatically adjusts to market volatility, acting as a dynamic support/resistance level.
   Price > TRAMA = Bullish
   Price < TRAMA = Bearish
   
2. Momentum Filter (RSI Crossover): Momentum is measured by a crossover of two moving averages of the RSI (a fast EMA and a slow SMA). This confirms whether the momentum is pointing in the same direction as the trend.
   
3. Strength Filter (ADX): This is the most important filter. A signal is only considered valid if the ADX (Average Directional Index) is above a defined threshold (Default: 30). This ensures the trend has sufficient strength.
   

🚦 How to Read the Indicator
The indicator has three states, displayed directly as bar colors on your chart:

🟩 GREEN BARS (Strong Uptrend) All three conditions are met:

1. Price is above the TRAMA.
   
2. RSI momentum is bullish (Fast MA > Slow MA).
   
3. ADX is above 30 (Strong trend is present).
   

🟥 RED BARS (Strong Downtrend) All three conditions are met:

1. Price is below the TRAMA.
   
2. RSI momentum is bearish (Fast MA < Slow MA).
   
3. ADX is above 30 (Strong trend is present).
   

🟧 ORANGE BARS (Neutral / Caution) This state appears if any of the following conditions are true:

• Weak Trend: The ADX is below 30. The market is in consolidation or a sideways phase. (This is the primary filter!)
  
• Indecision: The price is caught in the "Neutral Zone" between the TRAMA and the 200 SMA.
  

Visual Elements

• Bar Colors: (Green/Red/Orange) Show the current trend status.
  
• TRAMA (Orange Line): Your primary adaptive trendline.
  
• 200 SMA (White Line): Serves as a reference for the long-term trend.
  
• Orange Background (Fill): Fills the area between the TRAMA and SMA to visually highlight the "Neutral Zone."
  

Key Benefit
The goal of the ADX TSF is to keep traders out of weak, unpredictable markets and help them participate only in strong, momentum-confirmed trends.


Have fun :)


Disclaimer
This "Buy The F*cking Dip" (BTFD) indicator is provided for informational and educational purposes only. It does not, and should not be construed as, financial, investment, or trading advice.
The signals generated by this tool (both "Buy" and "Sell") are the result of a specific set of algorithmic conditions. They are not a direct recommendation to buy or sell any asset. All trading and investing in financial markets involves substantial risk of loss. You can lose all of your invested capital.
Past performance is not indicative of future results. The signals generated may produce false or losing trades. The creator (© DotGain) assumes no liability for any financial losses or damages you may incur as a result of using this indicator.
You are solely responsible for your own trading and investment decisions. Always conduct your own research (DYOR) and consider your personal risk tolerance before making any trades.