# Powered Kaufman Adaptive Moving Average

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Introduction

The ability the Kaufman adaptive moving average ( KAMA ) has to be flat during ranging markets and close to the price during trending markets is what make this moving average one of the most useful in technical analysis . KAMA is calculated by using exponential averaging using the efficiency ratio (ER) as smoothing variable where 1 > ER > 0. An increasing efficiency ratio indicate a trending market. Based on one of my latest indicator (see Kaufman Adaptive Bands) i propose this modified KAMA that allow to emphasis the abilities of KAMA by powering the efficiency ratio. I also added a new option that allow for even more adaptivity.

The Indicator

The indicator is a simple KAMA of period length that use a powered ER with exponent factor.

When factor = 1 the indicator is a simple KAMA , however when factor > 1 there can be more emphasis on the flattening effect of KAMA .

You can also restrain this effect by using 1 > factor > 0

Note that when the exponent is lower than 1 and greater than 0 you are basically applying a nth square root to the value, for example pow(2,0.5) = sqrt(2) because 1/0.5 = 2, in our case :

pow(ER,factor > 1) < ER and pow(ER,1 > factor > 0) > ER

Self Powered P-KAMA

When the self powered option is checked you are basically powering ER with the reciprocal of ER as exponent , however factor does no longer change anything. This can give interesting results since the exponent depend on the market trend strength.

In orange the self powered KAMA of period length = 50 and in blue a basic powered KAMA with a factor of 3 and a period of length = 50.

Conclusion

Applying basic math to indicators is always fun and easy to do, if you have adaptive moving averages using exponential averaging try powering your smoothing variable in order to see interesting results. I hope you like this indicator. Thanks for reading !

Open-source script

In true TradingView spirit, the author of this script has published it open-source, so traders can understand and verify it. Cheers to the author! You may use it for free, but reuse of this code in a publication is governed by House Rules. You can favorite it to use it on a chart.

Want to use this script on a chart?
Patreon: https://www.patreon.com/alexgrover

You can also check out some of the indicators I made for luxalgo : https://www.tradingview.com/u/LuxAlgo/#published-scripts

## Kommentarer

Most strategies and indicators work great in trending markets (basically everything and everything is succesfull then) the most difficult task is to determine when a market is ranging or trending, so you know when to shut down your system or not.
Maybe this can be of a great help, perhaps by evaluating the angle of the kama or similar.

Anyway, another great 10-lines masterpiece!

Gr, JD.
Svara
Duyck
@Duyck, Thx for your comment and for the support
Svara
Nice work. I like this one. Kaufman's work is very interesting..under rated.
Svara
chartmojo
@chartmojo, Thx for the support, i don't think kaufman is under rated tho :)
Svara
Another great step towards streightening a price curve into a zigzag.))
Svara
capissimo
@capissimo, thx for the support :)
Svara
Very interesting. Great work, thanks.
Svara
DreamsDefined
@DreamsDefined, Glad you like it :)
Svara
Hi Alex, Thanks for sharing and insight!!!!! It is Great!!!!!!. Hope you had nice vacation.
Svara
sudhir.mehta