Indicator AML (Adaptive Market Level) displays one of three market states: Flat, uptrend, and downtrend.
It is based on fractal smoothing and has a discrete filter that removes small price movements: If the price movement amplitude does not exceed the square of the predefined amplitude within the specified range, then this price movement will be ignored and considered a flat one.
It has two parameters:
- Period – calculation period;
- Dimension – price movement amplitude in points.
Calculation:
If ABS(FR – FR(Dimension)) < LAG:
AML = PrevAML
otherwise:
AML = FR
where:
LAG = Dimension * Dimension * Point FR = Alpha * Price + (1.0 - Alpha) * PrevFR Price = (High + Low + 2.0 * Open + 2.0 * Close) / 6.0
Alpha = EXP(-1.0 * Dimension * (DIM – 1.0)) in the range from 0.01 to 1.0
If R1+R2 > 0 and R3 > 0:
DIM = 1.44269504088896 * (LOG(R1+R2) – LOG(R3))
Otherwise:
DIM = 0
- R1 – (Maximum price – Minimum price within thΠ΅ Period from the current price) / Period
- R2 – (Maximum price – Minimum price within the Period from i+Period) / Period
- R3 – (Maximum price – Minimum price within the Period * 2) / Period * 2
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