Filter Volume

1. Indicator Name

Filter Volume

2. One-line Introduction

A regression-based trend filter that quantifies and visualizes market direction and strength using price behavior.

3. Overall Description

Filter Volume+ is a trend-detection indicator that uses linear regression to evaluate the dominant direction of price movement over a given period.
It compares historical regression values to determine whether the market is in a bullish, bearish, or neutral state.
The indicator applies a percentage threshold to filter out weak or indecisive trends, highlighting only significant movements.
Each trend state is visualized through distinct colors: bullish (greenish), bearish (reddish), and neutral (gray), with intensity reflecting trend strength.
To reduce noise and create smooth visual signals, a three-step smoothing process is applied to the raw trend intensity.
Users can customize the regression source, lookback period, and sensitivity, allowing the indicator to adapt to various assets and timeframes.
This tool is especially useful in filtering entry signals based on clear directional bias, making it suitable for trend-following or confirmation strategies.

4. Key Benefits (Title + Description)

✅ Quantified Trend Strength
Only displays trend signals when a statistically significant direction is detected using linear regression comparisons.

✅ Visual Clarity with Color Coding
Each market state (bullish, bearish, neutral) is represented with distinct colors and transparency, enabling fast interpretation.

✅ Custom Regression Source
Users can define the data input (e.g., close, open, indicator output) for regression calculation, increasing strategic flexibility.

✅ Multi-Level Smoothing
Applies three layers of smoothing (via moving averages) to eliminate noise and produce a stable, flowing trend curve.

✅ Area Fill Visualization
Plots a colored band between the trend value and zero-line, helping users quickly gauge the market's dominant force.

✅ Adjustable Sensitivity Settings
Includes tolerance and lookback controls, allowing traders to fine-tune how reactive or conservative the trend detection should be.

5. Indicator User Guide
📌 Basic Concept

Filter Volume+ assesses the direction of price by comparing regression values over a selected period.
If the percentage of upward comparisons exceeds a threshold, a bullish state is shown; if downward comparisons dominate, it shows a bearish state.

⚙️ Settings Overview

Lookback Period (n): The number of bars to compare for trend analysis

Range Tolerance (%): Minimum threshold for declaring a strong trend

Regression Source: The data used for regression (e.g., close, open)

Linear Regression Length: Number of bars used to compute each regression value

Bull/Bear Color: Custom colors for bullish and bearish trends

📈 Example Timing

When the trend line stays above zero and the green color intensity increases → trend gaining strength

After a neutral phase (gray), the color shifts quickly to greenish → early trend reversal

📉 Example Timing

When the trend line stays below zero with deepening red color → strong bearish continuation

Sudden change from bullish to bearish color with rising intensity

🧪 Recommended Use

Use as a trend confirmation filter alongside entry/exit strategies

Ideal for swing or position trades in trending markets

Combine with oscillators like RSI or MACD for improved signal validation

🔒 Cautions

In ranging (sideways) markets, the color may change frequently – avoid relying solely on this indicator in those zones.

Low-intensity colors (faded) suggest weak trends – better to stay on the sidelines.

A short lookback period may cause over-sensitivity and false signals.

When using non-price regression sources, expect the indicator to behave differently – test before deploying.
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