SMC⁵ – Enhanced Composite + Strong Divergences & Lines

SMC⁵⁺ is a next-generation momentum and divergence indicator that fuses four key volume-and-flow metrics into a single, ultra-responsive conviction score—and then plots clear, strong divergence signals directly on that composite line.

Key Logic & Workflow

Composite Construction

On-Balance Volume (OBV): Captures directional volume flow.

Chaikin Money Flow (CMF): Weighs close location within the bar by volume.

Cumulative Volume Delta (CVD): Measures aggressive buyer vs. seller pressure.

Money Flow Index (MFI): Reflects overbought/oversold conditions using typical price and volume.

Each raw series is transformed into a rolling z-score over a user-configurable lookback (Norm Length). This ensures stationarity and removes boundary artifacts.

Weighted by individual “trust” inputs (OBV, CMF, CVD, MFI weights), then optionally smoothed with an EMA to dial in responsiveness vs. noise.

Gradient Zone Highlight

The composite oscillates between 0–1 (neutral at 0.5).

A dynamic green/red gradient fill instantly shows when conviction enters “High” (>Upper Threshold) or “Low” (<Lower Threshold) zones—perfect for quick visual scans.

Divergence Detection

Regular Divergence:

Requires a minimum % price swing on the composite and a composite delta beyond a dynamic threshold (Reg Δ × StDev), ensuring only the most significant tops/bottoms trigger.

Plotted with bold lines and labels directly on the composite curve for unambiguous signals.

Hidden Divergence:

Uses a lighter threshold (Hid Δ × StDev) and thinner styling to highlight continuation opportunities behind the scenes—so you never miss stealth moves.

Both divergence types are pruned to a configurable maximum to keep your chart clean.

Why It’s Strong

Multi-Metric Confluence: By combining four independent flow/volume metrics, false-signal noise from any single source is virtually eliminated.

Statistical Normalization: Z-score transforms allow direct comparability and robust thresholding across any asset or timeframe.

Dynamic Sensitivity: User-tunable StDev multipliers and minimum Δ filters guarantee that only high-confidence divergences make it through.

Visual Clarity: Divergences are drawn on the actual composite line (not price), making it immediately clear when momentum is shifting beneath price action.

How to Use

Drop SMC⁵⁺ on any chart (works on all symbols/timeframes).

Adjust the four weights to emphasize your favorite flow metric.

Tweak Norm Length, Reg × StDev, and Min Composite Δ to tune sensitivity.

Watch for bold “Reg Div” signals for high-quality reversal setups, and lighter “Hid Div” signals for stealth continuation entries.

Combine with your trend filter or higher-timeframe confluence for pinpoint entries.

SMC⁵⁺ brings institutional-grade volume-flow analysis and divergence detection into one elegant package—empowering you to spot true momentum shifts before the crowd.