Andean Volumatic Variance Trend

Family: trend_following · Regime: trending · Complexity: high · Asset classes: Equities, Forex, Crypto · Timeframes: H1, H4

Thesis

Market trends are most likely to persist when price breaks from high-volume structural support (consensus) during periods of low price variance (MSE), indicating an orderly accumulation phase. By combining Andean variance-decomposition with volume-weighted levels, we can isolate institutional 'mark-up' phases from retail-driven noise.

Components

• Andean Oscillator (regime) — Defines the primary trend regime by comparing bullish and bearish variance; ensures we only trade in the direction of dominant volatility pressure.
• ADX / Connectable [Azullian] (direction) — Confirms directional strength; requires ADX > 20 to ensure the market is not in a low-momentum 'drift' phase.
• Volumatic Support/Resistance Levels [BigBeluga] (entry) — Acts as the trigger mechanism; ensures entries occur near volume-validated structural levels rather than in 'no-mans-land'.
• Connect MACD (Azullian) (exit) — Provides a momentum-based exit signal to capture the meat of the move before price mean-reverts or exhausts.
• Daily High Low MTF (risk) — Defines hard risk boundaries based on institutional daily levels (Previous Day High/Low).
• Mean Squared Error (MSE) (volatility_filter) — Filters out entries during periods of erratic price variance (outliers) to ensure the trend is 'clean' and orderly.

Known failure conditions

• MSE remains consistently above its 200-period average, indicating permanent regime shift to high-noise environment.
• ADX stays below 20 for more than 50 bars, signaling a range-bound market where Andean signals will whipsaw.
• Price fails to respect Volumatic bands, repeatedly crossing levels without volume expansion.

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