OPEN-SOURCE SCRIPT
COTE Volatility
COTE Volatility
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1. WHAT THIS INDICATOR DOES
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COTE Volatility is a price-based volatility indicator designed to detect abnormal price expansion using ATR (Average True Range).
Its main purpose:
→ Identify **volatility spikes**
→ Highlight **explosive candles (expansion bars)**
→ Separate bullish and bearish momentum bursts
It answers:
→ “Is this move normal or abnormal?”
→ “Is this candle driven by strong participation?”
---
━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━
2. CORE LOGIC / UNIQUE EDGE
━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━
This is NOT just an ATR indicator.
It simplifies volatility into a **clear decision signal**:
━━━━━━━━━━
1) ATR-Based Dynamic Threshold
━━━━━━━━━━
Instead of fixed thresholds:
→ Uses ATR (market volatility baseline)
→ Adapts automatically to market conditions
Formula:
ATR × Multiplier = volatility threshold
---
━━━━━━━━━━
2) Expansion Detection (Core Mechanism)
━━━━━━━━━━
Measures candle size:
candleRange = high - low
Then compares:
candleRange > ATR × multiplier
If TRUE:
→ This is a **volatility spike**
Meaning:
→ Market moved more than expected
---
━━━━━━━━━━
3) Directional Filtering
━━━━━━━━━━
Not all spikes are equal.
The indicator separates:
• Bullish Spike → close > open
• Bearish Spike → close < open
This gives:
→ Direction + strength in one signal
---
━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━
3. HOW IT WORKS
━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━
STEP 1 — Calculate ATR
→ Measures average volatility
STEP 2 — Measure Candle Range
→ high - low
STEP 3 — Compare with Threshold
If:
candleRange > ATR × multiplier
→ Volatility Spike detected
STEP 4 — Classify Direction
• Close > Open → Bullish Spike
• Close < Open → Bearish Spike
STEP 5 — Plot Signals
• Green triangle → Bullish expansion
• Red triangle → Bearish expansion
---
━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━
4. HOW TO USE
━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━
━━━━━━━━━━
1) Breakout Confirmation
━━━━━━━━━━
Large spike after consolidation:
→ Confirms breakout strength
→ Not a fake move
---
━━━━━━━━━━
2) Momentum Entry
━━━━━━━━━━
Bullish spike:
→ Strong buying pressure
Bearish spike:
→ Strong selling pressure
Best used with:
→ Trend direction
→ Support / resistance
---
━━━━━━━━━━
3) Trap Detection
━━━━━━━━━━
Spike against higher timeframe trend:
→ Possible trap / fake move
Example:
→ Bear spike in strong uptrend → absorption
---
━━━━━━━━━━
4) Volatility Regime Shift
━━━━━━━━━━
Clusters of spikes:
→ Market transitioning from low → high volatility
Important for:
→ Timing expansion phases
---
━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━
5. SETTINGS GUIDE
━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━
atrLength
→ ATR sensitivity
Low → reacts faster
High → smoother, slower
multiplier
→ Spike threshold
Low (1.5–2.0) → more signals
High (2.5–3.0) → only extreme moves
---
━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━
6. IMPORTANT NOTES
━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━
• This indicator does NOT predict direction
→ Only shows volatility expansion
• A spike ≠ automatic entry
→ Must be combined with context
• Works best with:
→ Trend
→ Liquidity zones
→ Volume analysis
• In low volatility markets:
→ Signals will be rare
---
━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━
🎯 KEY INSIGHT
━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━
This indicator is designed to detect:
→ Abnormal price expansion
→ Institutional activity moments
→ High-impact candles
Not just volatility — but **meaningful volatility**
━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━
1. WHAT THIS INDICATOR DOES
━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━
COTE Volatility is a price-based volatility indicator designed to detect abnormal price expansion using ATR (Average True Range).
Its main purpose:
→ Identify **volatility spikes**
→ Highlight **explosive candles (expansion bars)**
→ Separate bullish and bearish momentum bursts
It answers:
→ “Is this move normal or abnormal?”
→ “Is this candle driven by strong participation?”
---
━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━
2. CORE LOGIC / UNIQUE EDGE
━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━
This is NOT just an ATR indicator.
It simplifies volatility into a **clear decision signal**:
━━━━━━━━━━
1) ATR-Based Dynamic Threshold
━━━━━━━━━━
Instead of fixed thresholds:
→ Uses ATR (market volatility baseline)
→ Adapts automatically to market conditions
Formula:
ATR × Multiplier = volatility threshold
---
━━━━━━━━━━
2) Expansion Detection (Core Mechanism)
━━━━━━━━━━
Measures candle size:
candleRange = high - low
Then compares:
candleRange > ATR × multiplier
If TRUE:
→ This is a **volatility spike**
Meaning:
→ Market moved more than expected
---
━━━━━━━━━━
3) Directional Filtering
━━━━━━━━━━
Not all spikes are equal.
The indicator separates:
• Bullish Spike → close > open
• Bearish Spike → close < open
This gives:
→ Direction + strength in one signal
---
━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━
3. HOW IT WORKS
━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━
STEP 1 — Calculate ATR
→ Measures average volatility
STEP 2 — Measure Candle Range
→ high - low
STEP 3 — Compare with Threshold
If:
candleRange > ATR × multiplier
→ Volatility Spike detected
STEP 4 — Classify Direction
• Close > Open → Bullish Spike
• Close < Open → Bearish Spike
STEP 5 — Plot Signals
• Green triangle → Bullish expansion
• Red triangle → Bearish expansion
---
━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━
4. HOW TO USE
━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━
━━━━━━━━━━
1) Breakout Confirmation
━━━━━━━━━━
Large spike after consolidation:
→ Confirms breakout strength
→ Not a fake move
---
━━━━━━━━━━
2) Momentum Entry
━━━━━━━━━━
Bullish spike:
→ Strong buying pressure
Bearish spike:
→ Strong selling pressure
Best used with:
→ Trend direction
→ Support / resistance
---
━━━━━━━━━━
3) Trap Detection
━━━━━━━━━━
Spike against higher timeframe trend:
→ Possible trap / fake move
Example:
→ Bear spike in strong uptrend → absorption
---
━━━━━━━━━━
4) Volatility Regime Shift
━━━━━━━━━━
Clusters of spikes:
→ Market transitioning from low → high volatility
Important for:
→ Timing expansion phases
---
━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━
5. SETTINGS GUIDE
━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━
atrLength
→ ATR sensitivity
Low → reacts faster
High → smoother, slower
multiplier
→ Spike threshold
Low (1.5–2.0) → more signals
High (2.5–3.0) → only extreme moves
---
━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━
6. IMPORTANT NOTES
━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━
• This indicator does NOT predict direction
→ Only shows volatility expansion
• A spike ≠ automatic entry
→ Must be combined with context
• Works best with:
→ Trend
→ Liquidity zones
→ Volume analysis
• In low volatility markets:
→ Signals will be rare
---
━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━
🎯 KEY INSIGHT
━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━
This indicator is designed to detect:
→ Abnormal price expansion
→ Institutional activity moments
→ High-impact candles
Not just volatility — but **meaningful volatility**
Open-source script
In true TradingView spirit, the creator of this script has made it open-source, so that traders can review and verify its functionality. Kudos to the author! While you can use it for free, remember that republishing the code is subject to our House Rules.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.
Open-source script
In true TradingView spirit, the creator of this script has made it open-source, so that traders can review and verify its functionality. Kudos to the author! While you can use it for free, remember that republishing the code is subject to our House Rules.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.