Adaptive SuperTrend (Pine v6) — Auto Method Selection

Summary

The presenter demonstrates an Adaptive SuperTrend indicator that automatically selects among volatility-adaptive methods. The goal is to adjust the SuperTrend to changing volatility and reduce false signals. The presenter explicitly says it cannot eliminate false signals and provides no quantified accuracy or performance guarantee.

Indicator setup and selection framework

Users can choose how the indicator ranks methods:

• Total points
• Win rate
• Average profit per trade

In automatic mode, the indicator selects the method with the strongest result under the chosen criterion. It uses a minimum-trade threshold before selecting a method. The presenter cites a default of about 5 trades, with 10 trades as an alternative example.

The presenter describes a 60-day performance lookback and a separate, more recent sample for adapting the method. Examples include using 40 bars at the chosen interval or changing the setting to 30 bars. At 15-minute intervals, 30 bars is about 450 minutes.

Methods discussed include:

• Percentile: Compares current ATR with its recent distribution; the example uses 100 ATR observations.
• Regime: Classifies volatility as low, normal, or high using a moving-average comparison.
• Z-score (called “Jet Score” in the subtitles): Uses the standard deviation of ATR.
• Dynamic period: Changes the ATR period rather than only changing the multiplier.
• Rate of change: Responds to how quickly ATR changes.
• Multi-timeframe: Compares behavior across timeframes, such as hourly and daily.
• Hybrid: Mentioned but not explained in detail.

Manual method selection is also available. The presenter suggests that different instruments may suit different methods. He says he has often found the Z-score/“Jet Score” method useful, but presents this as personal experience rather than a measured general result.

SuperTrend mechanics and settings

The basic bands are described as the midpoint of the period’s high and low, adjusted by ATR × multiplier.

The presenter uses an ATR period of 10 and a multiplier of 3 as common defaults. Other examples include 21/4 and 7/3. He says the multiplier can be changed and that a higher multiplier generally produces fewer signals.

A higher multiplier may make signals less frequent, but delayed signals can hurt mark-to-market performance. Lowering the multiplier can generate more signals, but may also lead to more stop-outs.

Illustrative volatility figures include HDFC Bank ATR around ₹6 per hour and Nifty ATR around 55 points per hour. The accompanying calculations in the transcript are inconsistent, so these should be treated as examples rather than precise measurements.

Trading examples and risk comments

The presenter says the indicator can be used on stocks, indices, commodities, futures, and option prices. He describes a 15-minute Nifty signal and a weekly Nifty signal around April 15, 2025, which he associates with the period after Trump’s tariff announcement. These are chart examples, not audited performance results.

He also describes a personal Nifty options trade involving a short strangle. The strikes and quantities are unclear in the subtitles. He says he exited one side after the market fell, kept the other side while there was no exit signal, adjusted the position, and later exited. He estimates the trade returned about 0.9%. This is an anecdotal trade report.

For low-momentum instruments such as Coal India, he cautions that directional buy/sell signals may be unsuitable. He discusses options strategies such as straddles or strangles, while emphasizing that signals should be interpreted in the context of the instrument and strategy.

On risk management, the presenter says he buys a hedge before selling a strangle and recommends considering a hedge on one side of positional trades. He warns that unhedged short options can be difficult to manage during breakouts.

He cautions that stop-losses on short strangles can be hit on both sides. Instead, he suggests monitoring total position profit/loss and exiting at a personally defined maximum loss. This is the presenter’s view, not a universal rule.

The presenter says the indicator does not repaint and can be used on weekly charts and on crude oil, though he does not claim to trade crude oil himself. Near-expiry options may show more spikes than longer-dated options.

Assets and instruments mentioned

• Stocks: HDFC Bank, Coal India
• Indices: Nifty, Sensex
• Commodity: Crude oil
• Instruments and strategies: Futures; call and put options (CE/PE); short strangles and straddles; hedges

Disclosures and cautions

No explicit “not financial advice” disclaimer appears in the subtitles. The presenter discusses personal trading and strategy preferences. He does not provide a quantified accuracy rate and cautions that the indicator cannot prevent every false signal.

Presenter/source: The presenter identifies himself as Rabi; the video is from the Ravindra PE channel.