sharp vision traders

Adaptive moving averages started gaining popularity in the early 2000's after many that were introduced in the early 1990's. Kaufman Adaptive Moving Avg. for ThinkOrSwim was introduced in 1995. This indicator is heavily influenced by the volatility index adaptive moving average.

Since Kaufman Adaptive Moving Avg. (KAMA) is influenced by the volatility index; it may be a good idea to use one standard moving average. The image here shows a standard adaptive moving average with a period of 10 against a KAMA with a period of 20. In an upward trending market, down cycles tend to bounce off of KAMA. You would also know that a trend is potentially broken if a crossover occurs.

Kaufman Adaptive Moving Avg Features:

We'd encourage you to experiment with the variables. The user will have the option to adjust the period for fast- and slow-moving averages. The user will also have the ability to adjust the power at which the smoothing factor is raised to. We have come across a research site that adopted a different approach to estimating slow moving average. You can read about it here. The results are interesting but again, we'd encourage you to experiment with it.

Review the screenshots for setup options.

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