BTC Fractal Momentum Extremes

Description – BTC Fractal Momentum Extremes (BTCFME)
BTC Fractal Momentum Extremes (BTCFME) is a multi-factor, multi-method technical indicator designed to detect potential top and bottom reversal points in Bitcoin price action by integrating a confluence of unconventional signals. It combines fractals, adaptive momentum, volume dynamics, price velocity convergence, and market structure shifts — all filtered through real-time volatility and contextualized by temporal market conditions.

This tool is best used by traders looking to spot high-confidence turning points on intraday or swing timeframes, and works particularly well in volatile, momentum-driven environments.

Key Components & Methodology
BTCFME utilizes five independent signal-generation methods:

1. Fractal Volume Divergence
Detects reversal fractals in price (5-bar patterns) and validates them with volume anomalies:

Volume spikes (e.g., climax moves) or

Volume exhaustion (e.g., waning participation)

2. Adaptive Momentum Oscillator
Calculates momentum normalized by ATR-adjusted volatility, filtering out noise in choppy markets. It spots directional shifts when momentum inflects from extreme levels.

3. Market Structure Breaks
Identifies dynamic support and resistance using a configurable lookback, and flags potential breakouts or breakdowns from those levels.

4. Price Velocity Convergence
Analyzes the rate of change (velocity) and its acceleration. When both compress within a narrow volatility range, it signals a potential inflection zone.

5. Temporal Confluence Filter
Signals are only considered valid during active market hours (9 AM – 4 PM, excluding weekends) to reduce false positives during illiquid or inefficient trading periods.

Signal Logic & Sensitivity
Signals are generated when at least 3 out of 4 core methods agree, controlled by the Signal Sensitivity setting:

1 (High Sensitivity) = Trigger signals with fewer confirmations

5 (Low Sensitivity) = Require stronger multi-factor confluence

🔹 Buy (Bottom) Signals trigger when:

Bullish fractals appear

Momentum is deeply negative but improving

Price tests structure support

Velocity compresses below average

🔺 Sell (Top) Signals trigger when:

Bearish fractals with volume spikes appear

Momentum peaks and starts to decline

Price tests resistance

Velocity compresses near highs

Visual Features
Arrows: Buy signals = green arrow below candle. Sell signals = red arrow above candle.

Background Color: Indicates overall momentum regime (green = bullish bias, red = bearish, gray = neutral).

Dynamic Support & Resistance Lines: Based on recent swing highs/lows.

Signal Table (top-right): Shows real-time stats on:

Momentum value

Volatility factor

Volume strength (vs. 20-SMA)

Market structure status

Alerts
You can set alerts using the built-in conditions:

BTC Bottom Alert → Fires on potential market bottoms.

BTC Top Alert → Fires on potential market tops.

These alerts are filtered to avoid whipsaw conditions, by checking that opposite signals did not trigger in the last 2 candles.

How to Use
Timeframes: Best suited for 1H–4H and Daily BTC charts, but adaptable to others with parameter tuning.

Confirm with Price Action: Use BTCFME signals in conjunction with candlestick patterns or S/R zones for best results.

Adjust Sensitivity: Lower values catch more signals (good for scalping), higher values filter for stronger reversals (ideal for swing trades).

Use in Trending or Reversing Markets: BTCFME performs best during trending environments or volatile reversals — avoid during prolonged flat/ranging zones.

Notes & Recommendations
BTCFME is not a standalone buy/sell signal; combine it with risk management and trend confirmation tools.

Avoid using it during extremely low-volume sessions (e.g., late weekends).

Adjust parameters based on BTC's evolving volatility and your trading style.