TradersAID - Adaptive Smoothing Velocity Coloring

TradersAID – Adaptive Smoothing Velocity Coloring

1. Overview

TradersAID – Adaptive Smoothing Velocity Coloring is a momentum visualization tool designed to highlight bullish or bearish pressure directly on price bars — helping you intuitively read directional strength and velocity shifts in any market or timeframe.

Using a Kalman-inspired estimation framework originally developed for aerospace and autonomous navigation, this tool analyzes the velocity of price movement and assigns a contextual candle color — offering a clean and readable way to interpret short-term flow.

Whether you’re navigating ranges or watching for trend continuation, this visualization simplifies complex data into actionable visual rhythm.

2. What It Does

Instead of measuring only price, the script focuses on price velocity — the rate of change over time. It computes this through a proprietary estimator that continuously adapts to volatility and momentum shifts.

The output is color-coded candles that reflect velocity dynamics:
• Green shades represent bullish acceleration
• Red shades reflect bearish velocity
• Neutral tones indicate fading momentum or transition phases

This allows you to quickly assess market tone:
• In strong trends: Watch for fading momentum (weaker colors)
• In ranges: Spot subtle shifts that hint at upcoming breakout direction
• Near potential reversals: Diverging velocity and price can stand out at a glance

3. How to Use It
• Momentum Insight:
Use color intensity to judge whether the current move is gaining or losing strength.
• Breakout Anticipation:
In sideways markets, shifting colors within the range can help anticipate which side may take control next.
• Divergence Reading:
Look for double tops or bottoms where price holds but velocity changes — often a hint that the move is maturing.
• Visual Confirmation Layer:
Combine with structural tools (like TradersAID Warning Dots or Trend Bands) to add a layer of momentum awareness.

4. Key Features
• Adaptive Velocity Model: Kalman-filter-like algorithm continuously tracks price velocity
• Gradient Candle Coloring: Smooth scale from deep red (strong bearish) to deep green (strong bullish)
• Flexible Sensitivity Modes:
o Slow – smoothest interpretation
o Regular – balanced tone
o Fast – more responsive
• RSI Normalization: Translates raw velocity into a familiar oscillator scale
• Full Overlay Integration: Candle coloring works seamlessly with other studies on the same chart

5. Technical Basis (Why It’s Closed Source)

The tool is built on a proprietary Unscented Kalman Filter implementation that estimates both price and its velocity simultaneously.
This advanced approach is rare in retail tools, drawing from real-time estimation techniques used in robotics and aerospace applications.

While the source remains closed to protect the performance logic and smoothing implementation, the core concepts — adaptive filtering, velocity-based analysis, and visual gradient output — are fully explained here for transparency and compliant understanding.

6. Settings
• Sensitivity Modes: Fast / Regular / Slow
• RSI Length: Adjustable to control the smoothness of velocity normalization
• Color Theme: Intuitive gradient from red (bearish) to green (bullish)
• Compatible Timeframes: Designed to work across all timeframes — no restriction

7. Disclaimer

This tool is for educational and informational purposes only. It does not offer financial advice, predict outcomes, or generate trading signals. Always use in conjunction with your own analysis and supporting systems.