How adaptive grids work

Principle

The step is derived from a volatility measure — most often ATR (Average True Range) on a chosen timeframe. When the market moves more, the distance between levels grows; when it calms down, it shrinks.

What it gives

• In a strong move the grid opens fewer levels over the same price path — exposure grows more slowly.
• In a calm market cycles close more often.
• The level distance stays proportionate to the typical swing rather than arbitrary.

Further adaptations

• A wider step for deeper levels (each further than the last).
• A regime filter: a pause in a strong higher-timeframe trend.
• A pause around significant calendar events.

Limitations

Adaptation does not remove the grid's main risk — a long move with no pullback. ATR lags: at a sudden jump the step is still calculated from a calm period. Volume and drawdown limits therefore remain mandatory.