CapitalFlowsResearch: PEMA Threshold

CapitalFlowsResearch: PEMA Threshold — Forward Regime Projection

CapitalFlowsResearch: PEMA Threshold extends the logic of the standard PEMA framework by not only identifying when price is in an extended regime, but also calculating the exact price levels where the next regime flip would occur. Instead of waiting for a signal to trigger, the tool projects the thresholds forward in real time, showing traders the points at which the current regime would shift from positive to negative extension (or vice versa).

Conceptually, the script takes the behaviour of price around its moving equilibrium and determines how far price would need to travel for the underlying extension score to breach its upper or lower band. These projected “flip prices” can be displayed as guide lines or labelled directly on the chart, providing a live map of where key behavioural shifts would take place.

This transforms PEMA from a reactive overlay into an anticipatory one—helping traders plan entries, stops, and scenario paths with a clear understanding of where the market’s statistical pressure points sit, without exposing the underlying calculations.