Yes it is based on internal resistance, I don’t know what the threshold is for changing, I find for my Liion cells it chooses 500ma for most protected cells and 1A for unprotected cells.
Useful information about the charger in this review here: https://lygte-info.dk/review/Review%20Charger%20Xtar%20VC2S%20UK.html
I also have this charger and occasionally use it for NIMH cells, but most of the time I use the ikea Ladda charger which works well: https://lygte-info.dk/review/Review%20Charger%20Ikea%20Ladda%20YH-990BF%20UK.html