Trend vs Chop Detector - Stocky Mind ⚡️

👉🏻 Fractal Efficiency Ratio – Stocky Mind ⚡

This indicator helps traders identify whether the market is trending or choppy using the Fractal Efficiency Ratio (FE) as described originally by Perry J. Kaufman in his book Trading Systems and Methods & by Pradeep Bonde.

👉🏻 What it does

• Measures trend efficiency over a given period (length) by comparing net price change vs. cumulative absolute price change.
  

1. Higher FE values suggest linear (trending) price movement.

1. Lower FE values indicate choppiness or range-bound behaviour.

👉🏻 Key Features:

• Fractal Efficiency Plot: Visualize trend clarity numerically.
  

• Dynamic Background Zones:
  

1. Green: Strong linear trend (FE > threshold)
   

1. Red: Choppy market (FE < threshold)
   

• Customizable thresholds for both trend and chop zones.
  

👉🏻 Use Case

• Use this to filter stocks or confirm entries where price is moving smoothly.

• Avoid low-efficiency (choppy) zones where breakout trades may fail.

👉🏻 Note

• Best used in combination with price action and volume.

• Higher timeframes may smooth out noisy behaviour.

Brought to you by Stocky Mind ⚡ – Simplifying setups with logic and clarity.