Adaptive SMA Indicator – Smart Moving Average with ATR Adjustment!

"Trade with Precision – Let Adaptive SMA Guide Your Market Entries!"

Overview of Adaptive SMA Indicator

The Adaptive SMA is a custom MetaTrader 4/5 indicator that combines a Simple Moving Average (SMA) with Average True Range (ATR) to dynamically adjust its sensitivity based on market volatility.

Unlike traditional SMAs, this indicator automatically changes its period depending on volatility, making it more responsive in trending markets and smoother in ranging conditions.

Key Features

✅ Platform: MetaTrader 4 & 5 (MT4/MT5)

✅ Type: Trend-following indicator

✅ Calculation: SMA + ATR-based period adjustment

✅ Inputs:

MA Period (Default: 25)

Price Source (Close, Open, High, Low, etc.)

Smoothing Level (Default: 7)

✅ Visual: Orange line on the chart

How Does the Adaptive SMA Work?

1. Base SMA Calculation

Calculates a standard SMA based on the selected price source (e.g., Close).

2. ATR-Based Period Adjustment

Measures volatility using ATR (Average True Range).

Increases the SMA period in low volatility (smoother line).

Decreases the SMA period in high volatility (faster reaction).

3. Secondary Smoothing (Optional)

Applies an additional smoothing level (user-defined) for cleaner signals.

4. Dynamic Responsiveness

Works best in trending markets – reduces lag compared to fixed-period SMAs.

Avoids false signals in choppy markets – widens the period to filter noise.

Installation & Setup

Step-by-Step Guide

Copy the .mq4 or .mq5 file into:

MQL4/Indicators (MT4)

MQL5/Indicators (MT5)

Restart MT4/MT5 or refresh the Navigator panel.

Attach to Chart:

Drag & drop from the Indicators list.

Configure Settings:

MA Period (Default: 25)

Price Type (Close, Open, etc.)

Smoothing Level (Default: 7)

Best Settings & Recommendations

ParameterRecommended ValueNotes

MA Period20-50Adjust based on trading style

Price SourceCloseMost common choice

Smoothing Level5-10Higher = smoother line

Best TimeframeH1, H4, D1Works on all timeframes

Trading Strategies with Adaptive SMA

1. Trend Confirmation

Buy Signal: Price above Adaptive SMA + SMA rising.

Sell Signal: Price below Adaptive SMA + SMA falling.

2. Volatility-Based Filter

Tighter periods (high volatility) → More trades.

Wider periods (low volatility) → Fewer, higher-quality trades.

3. Combining with Other Indicators

RSI/Stochastic → For overbought/oversold confirmation.

MACD → For trend strength validation.

Pros & Cons

✅ Advantages

✔ Adapts to Market Conditions – No manual period adjustments needed.

✔ Reduces Lag – Better than fixed-period SMAs in trends.

✔ Customizable Smoothing – Extra filtering available.

Final Verdict – Should You Use It?

🔹 Best For:

Swing & position traders who need dynamic trend confirmation.

Volatility-based strategies (e.g., breakout trading).

🔹 Not Recommended For:

Scalpers (May be too slow for very short timeframes).

Recommendation:

Test on historical data first.

Combine with price action or momentum indicators for best results.

Developer & Source

🔹 Developer: R.KH

🔹 Version: 1.3

🔹 Availability: Custom MQL4 Indicator

"Adaptive SMA – Where Smart Moving Averages Meet Dynamic Volatility!" 🚀