Composite Momentum System

Oct 18

⚙️ Composite Momentum System — RSI + CCI + Momentum + MFI + (DI·ADX) × MACD² (4-Color Smoothed Signal)

This advanced indicator fuses multiple momentum, volume, and trend components into one unified oscillator, dynamically visualized around a zero line. It helps traders identify powerful directional moves, trend reversals, and momentum exhaustion far earlier than traditional MACD or RSI alone.

🧩 Core Formula

Composite = ((RSI + CCI + Momentum + MFI) + (((DI− × −1) + DI+) × ADX)) × (MACD²)

RSI – captures relative strength and short-term momentum

CCI – measures deviation from price mean (volatility & cycles)

Momentum – shows raw velocity of price change

MFI – volume-weighted momentum, adds money flow confirmation

DI / ADX – directional strength and market trend intensity

MACD² – amplifies strong momentum moves and filters weak noise

🌈 Visual Design & Features

Zero-Centered Histogram:
Green = Bullish momentum, Red = Bearish momentum

MACD Signal Line (4 Colors):

🟢 Positive & Rising → strong up momentum

🟡 Positive & Falling → weakening uptrend

🔴 Negative & Falling → strong downtrend

🟠 Negative & Rising → possible bearish fade or reversal

Adjustable Signal Smoothing:
Choose MA type (SMA, EMA, RMA, WMA, VWMA) and custom smoothing length for cleaner visualization.

ATR Normalization:
Optional setting to keep MACD and composite values consistent across instruments.

Centering Options:
RSI and MFI can be centered (−50/+50) to balance oscillation around zero.

🎯 How to Use

Above 0: Bullish composite energy → favor long setups.

Below 0: Bearish composite energy → favor short setups.

Signal line color changes highlight momentum acceleration or slowdown.

Crosses through zero often precede major shifts or breakout moments.

⚡ Best Practice

Use this indicator as a momentum strength filter in confluence with price action or volume patterns.
Combine it with VWAP, higher-timeframe trend, or support/resistance zones for high-probability entries.

Oct 18

Release Notes

⚙️ Composite Momentum System — RSI + CCI + Momentum + MFI + (DI·ADX) × MACD² (4-Color Smoothed Signal)

A unified momentum-trend oscillator combining RSI, CCI, Momentum, MFI, DI, ADX, and squared MACD, dynamically plotted around zero.

📚 Attribution:
This script uses the volatility-normalized MACD (MACD ÷ ATR) idea originally proposed by Alex Spiroglou in “MACD-v: Volatility Normalised Momentum” (2015 concept, 2022 publication).
Alex Spiroglou received both the NAAIM Founders Award (2022) and the CMT Association Charles H. Dow Award (2022) for this research.
No original code was reused — only the conceptual normalization technique is acknowledged.

💡 How to Use:
Positive values → bullish composite momentum.
Negative values → bearish composite momentum.
Signal-line color shifts indicate acceleration or weakening of momentum.

Oct 20

Release Notes

🧭 Update Summary — Version 2025.10.20

1️⃣ Yellow Bar Filter (Near-Zero Zone)

Added a new option to highlight yellow bars when the composite or MACD signal value is below a chosen threshold (default = 0.5).

⚠️ Note: Different timeframes have different volatility, so you may need to adjust this threshold for best visibility.

This feature helps to filter out small-range / sideways markets, allowing you to focus only on meaningful momentum moves.

2️⃣ Pre-Smooth Composite Line

Added an optional Pre-Smoothing layer to the composite calculation.

Makes the line smoother, cleaner, and more visually stable — ideal for identifying medium-term trend direction and avoiding short-term noise.

3️⃣ 4-Color Composite Visualization

The composite line now supports 4-color dynamic logic:

🟢 Positive + Rising

🟩 Positive + Falling

🟠 Negative + Rising

🔴 Negative + Falling

This enhancement allows you to catch turning points more efficiently and instantly see trend transitions at a glance.

Oct 20

Release Notes

🔵 Update — Blue Surge Highlight (2025.10.21)

New Feature: Blue Surge Highlight (% Change Detection)

Added a new Blue Highlight system to detect large momentum surges — when the Composite or MACD Signal changes by more than a chosen percentage compared to the previous bar.

The % change is calculated using absolute values, meaning both strong upward or downward moves (e.g. +2 → -2) are treated equally as a 100% change.

This helps to spot breakout momentum shifts in either direction — useful for identifying trend reversals, volatility spikes, or strong impulsive candles.

Default threshold: 100% (adjust based on your timeframe and volatility).

⚠️ Priority rule:

Yellow zone (low-volatility filter) still has higher priority than Blue surge.

When both occur together, yellow will override blue, to prevent false “breakout” colors in a flat market.