Variation index is the fractal's characteristic, which closely intertwines with a usual fractal's degree.
The indicator is used as a local characteristic defining dynamics of price row.
Common rules for the indicator are as follows:
The indicator's value below 0.5 means market is in trend.
Dramatically low value often precedes the end (correction) of current trend.
The indicator's value above 0.5 means market is in flat.
Dramatically high value often precedes beginning of significant trend.
The indicator's value located in the area of 0.5 means market has indefinite structure.
n – indicator's calculation parameter (to find the indicator's value, 2^n bars are used);
nBars – the value of history in bars, for which the indicator is found.