Momentum ATR Filter [Volensy] is an overlay signal indicator that aims to surface only high-confluence momentum breakouts. It blends momentum direction, ATR-based volatility expansion, EMA trend bias, RSI regime filtering, and volume confirmation to reduce low-quality signals in choppy conditions.
How It Works
Momentum trigger: Momentum (ta.mom) must exceed a user-defined threshold and be rising for longs (or below the negative threshold and falling for shorts).
Trend filter: For longs, price must be above the EMA. For shorts, price must be below the EMA.
Volatility regime: ATR must be elevated versus its 20-period ATR SMA (high-volatility condition) and also expanding versus the previous bar.
Distance filter: Price must push beyond an ATR-multiplied buffer around the EMA (Close > EMA + ATR*Multiplier for longs, Close < EMA – ATR*Multiplier for shorts).
RSI regime filter: Longs only when RSI is between 30 and 80; shorts only when RSI is between 20 and 70.
Volume confirmation: Volume must be greater than 1.2x the 20-period volume average.
What You’ll See on the Chart
EMA Trend line (orange) acting as the primary directional baseline.
ATR Bands around the EMA: upper band (green) and lower band (red), based on ATR * Multiplier.
Signals: green up-triangles for Buy signals and red down-triangles for Sell signals.
Signal Logic
Buy: Strong and rising momentum + high and expanding ATR + elevated volume + price above EMA + price above the ATR Upper band.
Sell: Strong and falling momentum + high and expanding ATR + elevated volume + price below EMA + price below the ATR Lower band.
Best Use Cases
Trend continuation / breakout environments where volatility and participation are increasing.
As a confirmation layer with market structure (breaks of range, reclaim/loss of key levels) or higher-timeframe direction.
Traders who prefer fewer but stricter signals due to multi-filter confluence.
Momentum Threshold: Increases or decreases how strong momentum must be to qualify.
ATR Length & ATR Multiplier: Define the volatility buffer size and how far price must move beyond the EMA to trigger.
EMA Length: Controls trend sensitivity (shorter = more reactive, longer = more conservative).
RSI Length: Adjusts how quickly the RSI regime filter adapts to changing conditions.
Alerts
Long Entry (Buy signal)
Short Entry (Sell signal)
High Volatility (ATR elevated vs its baseline)
Notes & Limitations
This script does not rely on repainting techniques; conditions are evaluated on confirmed bar data. As with most momentum/volatility filters, signals may lag and the tool may underperform during tight, range-bound markets.
Disclaimer
This indicator is for educational purposes only and is not financial advice. Always use proper risk management and confirm signals with your own analysis.
