Parameters

Period

• The Period determines the lookback length used for smoothing median price changes and volatility.

• It directly influences how sensitive or stable the BMO value will be:

  • A lower Period results in faster Market sentiments, but can be noisier.

  • A higher Period smooths out fluctuations and detects broader Market sentiments , but with slower response time.

• Internally, it defines the exponential smoothing factor, controlling how quickly Market sentiment momentum and volatility signals adapt to price changes.

• Best Practice: Use the default Period (7) for optimal balance between reactivity and stability, especially on higher time frame charts.

Filter

• The Filter parameter is used to fine-tune the responsiveness of the trend detection .

• It applies a threshold to the signal generation logic, helping to suppress minor fluctuations in the BMO value and filter out signals that may not reflect real market sentiment.

• This allows traders to reduce false signals, especially during volatile or choppy conditions when sentiment shifts rapidly.

• A higher Filter value makes the indicator more conservative, ignoring small sentiment-driven movements, while a lower value increases signal frequency by reacting to even subtle sentiment changes.

• Best Practice: It is recommended to keep the Filter at the default value of 0, which ensures the indicator responds accurately to genuine market sentiment without over-smoothing.