Volatility-Adjusted Momentum Oscillator (VAMO)

//@version=6
// MIT License
// Copyright (c) 2025 TPTBusiness
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indicator(title="Volatility-Adjusted Momentum Oscillator (VAMO)", shorttitle="VAMO", overlay=false)

// Inputs
momLength = input.int(14, title="Momentum Length", minval=1)
volLength = input.int(14, title="Volatility Length (ATR)", minval=1)
signalLength = input.int(9, title="Signal Line Length (EMA)", minval=1)
obLevel = input.float(70, title="Overbought Level", minval=0)
osLevel = input.float(30, title="Oversold Level", minval=0)

// Calculations
momentum = ta.roc(close, momLength) // Standard rate of change (momentum)
volatility = ta.atr(volLength) // Average True Range as volatility measure
vamo = momentum / volatility * 100 // Adjust momentum by volatility and scale for readability
signal = ta.ema(vamo, signalLength) // EMA signal line for crossovers

// Plots
plot(vamo, color=color.blue, title="VAMO Oscillator", linewidth=2)
plot(signal, color=color.orange, title="Signal Line", linewidth=1)
hline(obLevel, "Overbought", color=color.red, linestyle=hline.style_dashed)
hline(osLevel, "Oversold", color=color.green, linestyle=hline.style_dashed)

// Background colors for overbought/oversold
bgcolor(vamo > obLevel ? color.new(color.red, 90) : na)
bgcolor(vamo < osLevel ? color.new(color.green, 90) : na)