Market regimes explained: the six regimes, ADX, slope and ATR

Key takeaways

1. 1Six regimes: Bull+, Bull-, Bear+, Bear-, Chop and Quiet.
2. 2They come from ADX (strength), a 20-bar slope (direction) and ATR% (volatility), with hysteresis.

Why regimes matter

A market regime is a label for the kind of market you are in: trending up, trending down, going sideways with big swings, or going sideways quietly. Strategies are specialists. Trend followers earn in trends and bleed in ranges; mean-reversion strategies do the opposite. Knowing the regime tells you which kind of strategy has a chance, and it is why TensorTrader ranks scripts per regime and why TT-Autotune keeps a separate champion setting for each one.

The six regimes

Bull+ (strong uptrend)

ADX 25 or more with a strong positive slope

Bull- (weak uptrend)

ADX 18 or more with a weaker positive slope

Bear+ (strong downtrend)

ADX 25 or more with a strong negative slope

Bear- (weak downtrend)

ADX 18 or more with a weaker negative slope

Chop

No trend, and ATR% at or above the chop threshold: big moves both ways

Quiet

No trend, and ATR% below the chop threshold: small, sleepy moves

The three inputs

The rules are applied in order: a strong trend first, then a weak trend, then the volatility split. Thresholds are tuned per timeframe, because what counts as volatile on a 5-minute chart differs from a daily chart.

ADX(14)

Trend strength from 0 to 100, regardless of direction

20-bar regression slope, as a share of price

Direction and steepness of the trend

ATR(14) as a share of price

Volatility, used to split sideways markets into Chop and Quiet

Hysteresis: stopping the flicker

Raw labels can flip every few bars near a threshold. So a new regime must be seen for a number of bars in a row before it takes over, and the current regime must have been held for a minimum time. On the 1-hour chart that is 4 bars to confirm and 8 to hold; intraday charts use 5 and 10; the 4-hour chart uses 3 and 6. The result is labels that change when the market changes, not when a bar wobbles.

The story of each regime

Bull+

Buyers in control, pullbacks shallow. Trend followers earn; faders get run over.

Bull-

Grinding higher with frequent pullbacks. Patience and wider stops matter.

Bear+

Sellers in control, bounces fail. Shorts and cash win; dip buyers suffer.

Bear-

Slow bleed with sharp bounces. Short squeezes are common.

Chop

Big swings, no direction. Breakouts fail; mean reversion and small size help.

Quiet

Tight ranges, low volume. Fees can eat most edges; many strategies should sit out.

How TensorTrader uses regimes

TT-Autotune alerts report their regime code with every webhook (1 Bull+, 2 Bull-, 3 Bear+, 4 Bear-, 5 Quiet, 6 Chop), and the Pine script switches to that regime's tuned settings on every bar. On the server, TensorTrader refreshes its own regime label for each market about every five minutes, and refuses Autotune webhooks when the label is unknown or older than 30 minutes. The script tournament ranks every strategy within each regime and timeframe.

Seeing the regime yourself

The weekly regime board on TensorTrader shows how each tracked market was labeled over the past week, and TT-Autotune alerts carry the regime code with every signal, so the dashboard can show which regime a trade entered in.

• Weekly regime board →

Frequently asked questions

Which regime is best for trading?

Strong trends suit trend followers; Quiet markets suit few strategies after fees. There is no universally best regime.

Why does Quiet come before Chop in the webhook code?

The codes follow the classifier’s internal order (5 Quiet, 6 Chop); the website shows Chop first for readability.

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