MTF Fusion - High Volume Expansion Channel [TradingIndicators]Exceptionally high volume and rapid price expansion are key markers of powerful moves, especially when they occur during a breakout or breakdown. The High Volume Expansion Channel (HVEC) uses our multi-timeframe fusion and price compression/expansion algorithms to look for high volume and rapid expansion from multiple higher timeframes at once. It uses this info to determine a high volume and expansion 'grade', and then encodes this result into a colored channel. This channel coloring varies in intensity based on how exceptionally high volume is and how rapidly price is expanding in either direction.
What is MTF Fusion?
Multi-Timeframe (MTF) Fusion is the process of combining calculations from multiple timeframes higher than the chart's into one 'fused' value or indicator. It is based on the idea that integrating data from higher timeframes can help us to better identify short-term trading opportunities within the context of long-term market trends.
How does it work?
Let's use the context of this indicator, which calculates a 'high volume and expansion grade' (let's call it HVEG), as an example to explain how MTF Fusion works and how you can perform it yourself.
Step 1: Selecting Higher Timeframes
The first step is to determine the appropriate higher timeframes to use for the fusion calculation. These timeframes should typically be chosen based on their ability to provide meaningful data and action which actively affect the price action of the smaller timeframe you're focused on. For example, if you are trading the 5 minute chart, you might select the 15 minute, 30 minute, and hourly timeframe as the higher timeframes you want to fuse in order to give you a more holistic view of the trends and action affecting you on the 5 minute. In this indicator, four higher timeframes are automatically selected depending on the timeframe of the chart it is applied to.
Step 2: Gathering Data and Calculations
Once the higher timeframes are identified, the next step is to calculate the data from these higher timeframes that will be used to calculate your fused values. In this indicator, for example, the HVEG value is calculated by determining the HVEG for all four higher timeframes.
Step 3: Fusing the Values From Higher Timeframes
The next step is to actually combine the values from these higher timeframes to obtain your 'fused' indicator values. The simplest approach to this is to simply average them. If you have calculated the HVEG value from three higher timeframes, you can, for example, calculate your 'multi-timeframe fused HVEG' as (HigherTF_HVEG_1 + HigherTF_HVEG_2 + HigherTF_HVEG_3) / 3.0.
Step 4: Visualization and Interpretation
Once the calculations are complete, the resulting fused indicator values are plotted on the chart. These values reflect the fusion of data from the multiple higher timeframes, giving a broader perspective on the market's behavior and potentially valuable insights without the need to manually consider values from each higher timeframe yourself.
What makes this script unique? Why is it closed source?
While the process described above is fairly unique and sounds simple, the truly important key lies in determining which higher timeframes to fuse together, and how to weight their values when calculating the fused end result in such a way that best leverages their relationship for useful TA.
This MTF Fusion indicator employs a smart, adaptive algorithm which automatically selects appropriate higher timeframes to use in fusion calculations depending on the timeframe of the chart it is applied to. It also uses a dynamic algorithm to adjust and weight the high volume and price expansion grade calculations depending on each higher timeframe's relationship to the chart timeframe. These algorithms are based on extensive testing and are the reason behind this script's closed source status.
Included Features
MTF Fusion high volume and expansion coloring
MTF Fusion ATR-based channel for visual effect
Channel width customization and explanatory labels
Pre-built color stylings
Options
Show Channel Lines: Show/hide the upper and lower lines of the channel
Fill Channel: Fill the channel with coloring depicting the current degree of high volume and rapid price expansion
Channel Width Multiplier: Sets the width of the ATR-based channel
Explanatory Labels: Show/hide explanatory labels describing the visuals
Lookback: Select how you want the degree of high volume expansion to be calculated (longer = long-term high volume and expansion, shorter = short-term high volume and expansion)
Pre-Built Color Styles: Use a pre-built color styling (uncheck to use your own colors)
Manual Color Styles: When pre-built color styles are disabled, use these color inputs to define your own
Compression
Volatility patterns / quantifytools- Overview
Volatility patterns detect various forms of indecisive price action, on a larger scale as a compressed range and on a smaller scale as indecision candles. Indecisive and volatility suppressing price action can be thought of as a spring being pressed down. The more suppression, the more tension is built and eventually released as a spike or series of spikes in volatility. Each volatility pattern is assigned an influence period, during which average and peak relative volatility is recorded and stored to volatility metrics.
- Patterns
The following scenarios are qualified as indecision candles: inside candles, indecision engulfing candles and volatility shifts.
By default, each indecision candle is considered a valid pattern only when another indecision candle has taken place within 3 periods, e.g. prior inside candle + indecision engulfing candle = valid volatility pattern. This measurement is taken to filter noise by looking for multiple hints of pending volatility, rather than just one. Level of tolerated noise can be changed via input menu by using sensitivity setting, by default set to 2.
Sensitivity at 1: Any single indecision candle is considered a valid pattern
Sensitivity at 2: 2 indecision candles within 3 bars is considered a valid pattern
Sensitivity at 3: 2 indecision candles within 2 bars (consecutive) is considered a valid pattern
The following scenarios are qualified as range patterns: series of lower highs/higher lows and series of low volatility pivots.
A pivot is defined by highest/lowest point in price, by default within 2 periods back and 2 periods forward. When 4 pivots with qualities mentioned above are found, a box indicating compressed range will appear. Both required pivots and pivot definition can be adjusted via input menu.
- Influence time and metrics
By default, influence time for each volatility pattern is set to 6 candles, a period for which spike(s) in volatility is expected. For each influence period, average relative volatility (volatility relative to volatility SMA 20) and peak relative volatility is recorded and stored to volatility metrics. All metrics used in calculations are visible in "Data Window "tab. Average and peak volatility during influence period will vary depending on chart, timeframe and chosen settings. Tweaking the settings might result in an improvement and is worth experimenting with.
- Visuals
By default, indecision candles are visualized as yellow lines and range patterns as orange boxes. Influence time periods are respectively visualized as colored candle borders, applied as long as influence time period is active. All colors are fully customizable via input menu.
- Practical guide
Volatility patterns depict moments of equal strength from both bulls and bears. While this equilibrium is in place, price is stagnant and compresses until either side initiates volatility, releasing the built up tension. On top of hedging and playing the volatility using volatility based instruments, some other methods can be applied to take advantage of the somewhat tricky areas of indecision.
Example #1: Trading volatility
Volatility is not a bad thing from a trading perspective, but can actually be fertile ground for executing trade setups. Trading volatility influence periods from higher timeframes on lower timeframes gives greater resolution to work with and opportunities to take advantage of the wild swings created.
Example #2: Finding bias for patterns
Points of confluence where it anyway makes sense to favor one side over the other can be used for establishing bias for indecisive price action as well. At face value, it makes sense to expect bearish reactions at range highs and bullish reactions at range low, for which volatility patterns can provide a catalyst.
Example #3: Betting on initiation direction
Betting on direction of the first volatile move can easily go against you, but if risk/reward is able to compensate for the poor win rate, it's a valid idea to consider and explore.
GamCP Multi-timeframe v0.1Measures compression on different timeframes, on demand. A high compression precedes high volatilty.
v0.1 - by mufaxor
LNL Fractal EnergyMarkets knows only two movements. Expansion and Consolidation. The price is either moving or it is consolidating. Fractal Energy will show you which move is about to happen. The funny thing is.. Fractal Energy will NOT tell you the direction of the potential move nor the time when the move will happen. It only shows whether the energy is accumulating or exhausting and which one of these moves are about to happen.
Fractal Energy Zones:
1. Gray = Neutral Energy, price will spend most of the time between the 0.60 and 0.30 ranges, if the FE is hanging around midline chop can be expected.
2. Pink = Energy Building (low compression), pink can produce solid moves but can turn in to a red or dark red which are way more powerful.
3. Red = Energy Building (yet to be released), once the FE colors red there is a high probability for a bigger than expected move.
4. Dark Red = Energy Building (high compression), dark red is rare and can be seen usually around earnings reports (explosive move can be expected).
5. Yellow = Energy Released = Exhaustion, everything ends at some point, yellow color represents the exhaustion of the move (the car ran out of gas).
6. Orange = Extreme Exhaustion, high probability for a sideways action or a reversal.
Tips & Tricks:
1. Importance of the Midline:
- Midline can be used as a target for the compressions. Once the FE reach the midpoint, the move is usually considered to be over.
2. Huge Gaps on earnings DO NOT COUNT:
- If the price heavily gaps up or gaps down, FE usually drops too steep with the gap thus signals after such moves can be ignored.
3. Fractal Energy Length & Time Frames:
- For the daily & weekly time frame length of 13 works nicely. But for the lower TF length 13 starts to lag behind the price a little. I would suggest using Length 15 for 30min to 4 hour and Length 17 - 20 for below 30min time frames.
4. Exhaustions:
- Exhaustions can be played too. Once the FE drops below 0.30 the price usually stays within the weekly expected move (great for iron condors), or non directional option strategies.. yellow/orange = price either reverse or stays at same levels for a few candles..
5. Combination of direction based studies with the magnitude based studies:
- Use the FE as a confirmation of your analysis from other (direction-based) trend or momentum indicators. Once you analyze your direction you can use Fractal Energy (magnitute-based) indicator to analyse whether there is a chance for a big move or not.
Hope it helps.
Volume CompressorTurns volume into a more informative representation, ready to be further analyzed
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Rationale
Volume
Back in the "before the quant" days I was a big fan of market & volume profile. Thing is J. Steidlmayer had lotta different ideas & works aside of profiling, it's just most of them ain't got to mainstream, one of them was "Hot / Cold volume" (yes, you can't really google it). From my interpretation, the idea was that in a given asset there is a usual constant volume that stays there no matter what, and if it ever changes it changes very slow and gradually; and there's another kind of, so to say, 'active' volume that actually influences price dynamics and very volatile by its nature. So I've met concept lately, and decided to quantify & model it one day when I'll have an idea how. That day was yesterday.
Compression
When we do music we always use different kinds of filters (low-pass, high pass, etc) for equalization and filtering itself. That stuff we use in finance as well. What we also always use in music are compressors, there dynamic processors that automatically adjust volume so it will be more consistent. Almost all the cool music you hear is compressed (both individual instruments (especially vocals) and the whole track afterwards), otherwise stuff will be too quite and too weak to flex on it, and also DJing it would be a nightmare. I am a big adept of loudness war. So I was like, how can I use compression in finance, when ima get an idea? That day was yesterday as well.
Volume structure
Being inspired by Steidlmayer's idea, I decided to distinguish volume this way:
1) Passive / static volume. The ~ volume that's always there no matter what (hedges, arbitrages, spread legs, portfolio parts etc etc), doesn't affect things;
2) Active / dynamic volume. The volume that flows from one asset to another, really matters and affects things;
3) Excess volume. The last portion of number 2 volume, that doesn't represent any powerful value to affect things.
Now it's clear that we can get rid of number 1 and number 3, the components that don't really matter, and concentrate on number 2 in order to improve information gain, both for ourselves and for the models we feed this data. How?
Model
I don't wanna explain it all in statistical / DSP way for once.
First of all, I think the population of volumes is log-normally distributed, so let's take logs of volumes, now we have a ~ normally distributed data. We take linearly weighted mean, add and subtract linearly weighted standard deviation from it, these would be our thresholds, the borders between different kinds of volumes explained before.
The upper threshold is for downward compression, that will not let volume pass it higher.
The lower threshold is for upward compression, all the volumes lower than this threshold will be brought up to the threshold's level.
Then we apply multipliers to the thresholds in order to adjust em and find the sweet spots. We do it the same way as in sound engineering when we don't aim for overcompression, we adjust the thresholds until they start to touch the signal and all good.
Afterwards, we delete all the number 1 and number 3 volume, leaving us exclusively with the clear main component, ready to be processed further.
We return the volumes to dem real scale.
About the parameters, based on testing I don't recommend changing the thresholds from dem default values, first of all they make sense statistically and second they work as intended.
Window length can and should be adjusted, find your own way, or leave the default value. ML (moving location) length is up to you as well.
So yeah, you can see now we can smooth the data and make it visually appealing not only by applying a smooth filter over it.
All good TV?
[CBB] Volatility Squeeze ToyThe main concept and features of this script are adapted from Mark Whistler's book "Volatility Illuminated". I have deviated from the use cases and strategies presented in the book, but the 3 Bollinger Bands use his optimized settings as the default length and standard deviation multiplier. Further insights into Mark's concepts and volatility research were gained by reading and watching some of TV user DadShark's materials (www.tradingview.com).
This script has been through many refinements and feature cycles, and I've added unrelated complimentary features not present in the book. The indicator is better studied than described, and unless you have read the book, any short summary of the material will just make you squint and think about the wrong things.
Here is a limited outline of features and concepts:
1. 3 Bollinger Bands of different length and/or deviation multiplier. Perhaps think of them as representing the various time frames that compression and expansion cycles and events manifest in, and also the expression of range, speed and price distribution within those time frames. You can gain insight into the magnitude of events based on how the three bands interact and stay contained, or not. If volatility is significant enough, all "time frames" represented by the bands will eventually record the event and subsequent price action, but the early signals will come from the spasms of the shortest, most volatile band. Many times the short band will contract again before, or just as it reaches a longer band, but in extreme cases, volatility will explode and all bands at all time frames will erupt in succession. In these cases you will see additional color representing shorter bands (lower time frame volatility in concept) traveling outside of longer bands. It is worth taking a look at the price levels and candles where these volatility bands cross each other.
2. In addition to the mean of the bands, there are a variety of other moving averages available to gauge trend, range, and areas of interest. This is accomplished with variable VWAP, ATR, smoothing, and a special derived loosely from the difference between them.
3. The bands are also used to derive conditions under which volatility is considered compressed, or in "squeeze" . Under these conditions the candles will turn yellow. Depending on your chart settings and indicator settings, these zones can be completely useless or drag on through fairly significant price action. Or, the can give you fantastic levels to watch for breakouts. The point is that volatility is compressed during these conditions, and you should expect the inevitable once this condition ends. Sometimes you can find yourself in a nice fat trend straight away, other times you may blow an account because you gorged your position based on arbitrary bar color. It's not like that. Pay attention to the highest and lowest bars of these squeeze ranges, and carefully observe future price action when it returns to these squeeze ranges. This info is more and more valuable at higher time frames.
The 3 bands, a smoothed long trend VWAP, and the squeeze condition colored bars are all active by default. All features can be shown or hidden on the control panel.
There are some deep market insights to mine if you live with this one for a while. As with any indicator, blunt "buy/sell here" approaches will lead to loss and frustration. however , if you pay attention to squeeze range, band/moving average confluence, high volume and/or large range candles their open/close behavior around these areas and squeeze ranges, you will start to catch the beginning of some powerful momentum moves.
Enjoy!
ATR Volume DivergenceThe indicator measures ATR relative to VOLUME of each candle, marks the candles where there is more volume than in the previous one, but a lower ATR - signifying a compression in price movement - resistance. It also marks the candle where there is a greater ATR than in the previous candle, but lower volume - signifying an expansion in price movement - vacuum.
P.S. Bring indicator to FRONT to see the colored candles clearly
Baekdoo compressed multi EMA box and its crossover indicatorHi forks,
I'm trader Baekdoosan who trading Equity from South Korea. This Baekdoo compressed multi EMA box and its crossover indicator tells us good trading time for swing trading.
Here is the idea. As you can see formula, I put ema of 5 days to 100 days.
and draw box when all disparity of the EMAs are less than 5%
I put those value in input variable as 105 (100 means same as max/min disparity ratio, 105 means max is 5% greater than min). This can be used 110 (10% of box) based on your needs.
Once box are drew, I put indicator when it crossover the box with 5 times larger than 60 days' highest volume. Then I put triangle indicator. This will be good trading point for short-mid term trading. you can check historical chart to evaluate this.
Hope this will help your trading on equity as well as crypto. I didn't try it on futures . Best of luck all of you. Gazua~!
Compression support&resistance [LM]Hello traders,
I would like to present you Compression support&resistance script. The idea behind is to look for areas of price compression(inside bar candles). Basically the S/R lines are created after three candles that are formed in certain pattern and volume conditions. First candle of pattern is usually the most volatile and fist inside bar after volatile candle high and low creates S/R lines in order to look for breakouts or for future bounces of the S/R line. Also by default volume has to be decreasing from candle to candle, although this condition can be controlled by setting.
It has various settings as my other S/R scripts for multi timeframe analysis. The current timeframe uses line API but for multi timeframe I use plot lines. There are two filters. Volume filter for declining volume of the pattern candles and volatility filter which renders line only in case that pattern occurs after some % change has happened within some lookback period.
Credit also for this indicator goes to @berkek as he took time to explain it to me.
Hope you will enjoy it,
Lukas
Compressed Volume Levels [DepthHouse]Compressed Volume Levels closely analyzes peak volume along with price action to detect critical levels.
The compression levels generated are often an early indication of possible tops, bottoms, or even a future support or resistance levels.
Warning: Since this is a volume based indicator results will vary based on the asset and volume of the exchange.
The factor & lookback at which it detects these levels can be set by the user. The lower the factor the more levels that will generate.
Built in Alerts (must be set up by user):
Verified Support and Resistance once a level is confirmed.
Upward and Downwards Compression alerts; earliest signal possible for major volume coming in.
To gain access to this indicator please follow the link below.
Feel free to message me with any questions directly here on TradingView.
Bollinger Bands Width with Compression by UJBBollinger Band width % with compression line and color changing area.
ATR% with Compression by UJBPlot ATR% along with selected compression horizontal line. Bar color changes when inside specified value.
Dynamic Equalizer [DW]This is an experimental study inspired by techniques primarily utilized in the visual and audio processing worlds.
This study is designed to serve as a pre or post processing filter designer that allows you to shape the frequency spectrum of your data on a more "in-depth" level.
First the data is fed through my Band-Shelf Equalizer function.
The EQ in this script works by dividing the input signal into 6 bands and 2 shelves using a series of roofing filters.
The bands are then gain adjusted recursively (in %) to match source as closely as possible at unity gain.
The recursive adjustment size can be changed using the "Gain Adjustment Increment" input, which will affect how tightly the resulting filter approximates source at unity.
The frequency range of each band is adjustable via the period inputs. In default settings, these are the ranges:
-> Low Shelf : 256+ Samples Per Cycle. This shelf is the largest trend component of the signal. Unlike the other bands and shelf, this shelf is not zero mean unless source data is.
-> Band 1 : 128 - 256 Samples Per Cycle. This band is a moderate trend and low cyclic component of the signal.
-> Band 2 : 64 - 128 Samples Per Cycle. This band is a mild trend and moderate cyclic component of the signal.
-> Band 3 : 32 - 64 Samples Per Cycle. This band is a high cyclic component of the signal.
-> Band 4 : 16 - 32 Samples Per Cycle. This band is a high cyclic component of the signal.
-> Band 5 : 8 - 16 Samples Per Cycle. This band is a moderate cyclic and mild to moderate noise component of the signal.
-> Band 6 : 4 - 8 Samples Per Cycle. This band is a high noise component of the signal.
-> High Shelf : 4- Samples Per Cycle. This shelf is primarily noise.
Each band and shelf can be manually gain adjusted via their respective inputs.
After EQ processing, each band and shelf is then optionally fed through my Peak Envelope Compressor function for dynamics control.
The compressor in this script works by reducing band power by a specified percentage when it exceeds a user defined percentage of the peak envelope.
The peak envelope measures maximum power of the band over its period range multiplied by a user defined integer.
There is an option included to apply Butterworth smoothing to the envelope as well, which will alter the shape of the compressor.
If you want an envelope that quickly responds to power peaks, use little to no smoothing. If you desire something more static, use a large smoothing period.
Attack and release are included in the algorithm to shape the sensitivity of the compressor.
Attack controls how many bars it takes from being triggered for attenuation to reach its target amount.
Release controls how many bars it takes from being un-triggered for attenuation to reach back to 0.
In addition, the compressor is equipped with parallel processing.
The "Parallel Mix" inputs control the amount of compressed vs non-compressed signal presence in the final output.
And of course, the compressor has a post-processing gain input (in %) to fine-tune the presence of the band.
For easy visual tuning, you can view each independent band's magnitude or power by selecting them in the display inputs.
This display setup can also be beneficial analytically if you wish to analyze specific frequency components of the source signal.
The default preset for this script is meant to show how versatile EQ filtering and compression can be for technical analysis.
The EQ preset detrends the data, moderately smooths the data, and emphasizes dominant cyclical ranges.
The compression preset provides fast, moderately heavy shaping to dial in dynamics and reduce transient effects.
The resulting curve is a great filter for responsively analyzing cyclical momentum.
The script is also fully equipped with outputs that can be used externally by other scripts.
You can integrate these external outputs with your own script by using a source input. Simply select the desired output from the dropdown tab on your script.
Multiband filtering and compression are concepts that are not conventionally used in the world of finance.
However, the versatile capabilities of these concepts make this a wonderful tool to have in the arsenal.
By surgically adjusting separate frequency components of a signal, you're able to design a wide variety of filters with unique responses for a vast array of applications.
Play around with the settings and see what kinds of filters you can design!
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This is a premium script, and access is granted on an invite-only basis.
To gain access, get a copy of the script overview, or for additional inquiries, send me a direct message.
I look forward to hearing from you!
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General Disclaimer:
Trading stocks, futures, Forex, options, ETFs, cryptocurrencies or any other financial instrument has large potential rewards, but also large potential risk.
You must be aware of the risks and be willing to accept them in order to invest in stocks, futures, Forex, options, ETFs or cryptocurrencies.
Don’t trade with money you can’t afford to lose.
This is neither a solicitation nor an offer to Buy/Sell stocks, futures, Forex, options, ETFs, cryptocurrencies or any other financial instrument.
No representation is being made that any account will or is likely to achieve profits or losses of any kind.
The past performance of any trading system or methodology is not necessarily indicative of future results.
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NOTE: Unlike standard tools of this nature in other applications, I scaled the signals in % rather than dB, mainly since it's proven so far to be more user-friendly to keep things linear on here.
In addition, no transitions to frequency domain are done in this script. This EQ is an experimental variant that processes in the time domain and relies on a network of roofing filters.
When changing cutoff periods, make sure they are organized in descending order with low shelf as the highest period, and high shelf as the lowest period.
Using non-descending lengths may result in an undesired output.
Lastly, when changing cutoff periods, parts of the spectrum may leak slightly differently between bands, so the "Gain Match Adjustment Increment" may need to be changed as well if you want it to match as closely as possible at unity.
Despite these shortcomings, this tool functions surprisingly well, especially with the default periods, and it's quickly become one of my favorites. I hope you all enjoy it!
Array-Trend-BandsHere I propose a simple trend following system, where one can ride out moves in a trending direction and use it to reenter the trades in the direction of the trend. This band is also capable of tracking down the strength of the price action, there will be a real indication of compression in price movement and expansion.
These zones usually blow traders' accounts when they trade MA's, they end up taking too many trades in the compression zones, it an inherent fault with the MA systems, no matter which MA you use. This, however, is a very clear indicator to avoid these compression zones to take the trade and enter only when price gives clear breakout.
This indicator does not require user input and it works on all TF and all instruments, as long as there is a price, this will work.
Past performance is no assurance of future success. This is an idea for education purposes only.
Please note that this is coded using TV's newly introduced array functions, so it's extremely snappy.
Regards!
Pascal's Market Compression OscillatorThe indicator uses a standardized measure of volume and volatility to visualize the compression state of the market.
- Green: Market is currently compressing
- Red: Market is currently expanding
When the oscillator flips from Green to Red, the market is likely to enter a phase of expansion. This opens a window of opportunity for momentum strategies.
When the oscillator flips from Red to Green, the market is likely to enter a phase of compression. This makes it a favorable regime for mean reversion strategies.
Finally, please note that the indicator is NOT meant for directional analysis. e.g. when the oscillator signals "expansion", that can be up OR down.
Pascal's 4h Compression BreakoutThis indicator aims to identify areas of price compression, by looking for two consecutive "inside candles" on the 4h chart.
An inside candle is simply when the current candle's high is lower than the previous candle's high, and the current candle's low is higher than the previous candle's low.
Once price compression is identified, the indicator draws a range based on the highest high and the lowest low of the two inside candles.
1) A break above the range is bullish.
2) A break below the range is bearish.
The script ALSO paints candles in blue that are likely to become strong horizontal S/R levels. This is, again, based on a candle pattern.
Please note:
1) This indicator is only meant to be used on BITMEX:XBTUSD (on the 4h or 1h chart).
2) You will have to apply some discretion to profitably trade with this indicator. Use SFPs and horizontal S/R levels to judge if a breakout is worth trading.
Finally, use the indicator at your own risk. I am not responsible for any losses you may incur.
My objective with this indicator g is to hopefully give you something that you can build upon, and NOT a script to blindly copy trade.
The concept of market compression is powerful. There are countless ways in which you can build a system around it.
This is just the tip of the iceberg.
Cheers.
(JS) Squeeze Pro 2This is my version of the updated classic indicator created by John Carter. I plan on adding a Squeeze Overlay script in the future that will pair with this one as well for additional signals.
So to break down the Squeeze, what it is, how it works, etc - you have to look at the components that make it up.
1. Bollinger Bands
2. Keltner Channels
3. Momentum
The momentum in this indicator is smoothed out using linear regression (shout out to Lazy Bear, it's a much simpler way to do it, imo).
The momentum is what is displayed on the indicator as a histogram, its purpose is obvious (to show momentum).
Now what is a Squeeze? A squeeze occurs when Bollinger Bands tighten up enough to slip inside of Keltner Channels.
This is interpreted as price is compressing and building up energy before releasing it and making a big move.
Traditionally, John Carter's version uses 20 period SMAs as the basis lines on both the BB and the KC.
In my version, I've given the freedom to change this and try out different types of moving averages.
His original squeeze indicator had one Squeeze setting, though this new one has three .
The white dot Squeeze , call it a "low squeeze", an "early squeeze", whatever you'd like - this is the easiest Squeeze to form based on its settings.
The red dot Squeeze is the original from the first Squeeze indicator.
And finally, the yellow dot squeeze , call it a "high squeeze", "power squeeze", once again whatever you want - is the most difficult to form and suggests price is under extreme levels of compression.
From what I've witnessed John Carter say in the past, the squeeze is meant to be used for continuation.
Now to explain the parameters:
Squeeze Input - This is just the source for the Squeeze to use, default value is closing price.
Length - This is the length of time used to calculate the Bollinger Bands and Keltner Channels.
Bollinger Bands Calculation Type - Selects the type of moving average used to create the Bollinger Bands.
Keltner Channel Calculation Type - Selects the type of moving average used to create the Keltner Channel.
Color Format - I have created 5 different color schemes, this allows you to choose one.
Draw Divergence - Self explanatory here, this will auto-draw divergence on the indicator.
Gray Background for Dark Mode - This is something I put on all my indicators to make them more visually appealing.
Moving on to the alerts, I have made some basic alerts to notify certain indicator conditions (I had to revise it back from the prior version, as V4 of PineScript limits outputs).
6th Dot Alerts - This will inform you when a certain Squeeze makes it 6 dots in. Why 6 dots? That is what John Carter said to be his preference.
12th Dot Alerts - Think of this as a "prolonged Squeeze" alert. I feel like if they do run this long you likely need to go up in resolution, but some traders prefer certain time increments so this is for them.
End of Squeeze Alerts - Self explanatory again - once a Squeeze has concluded this will provide you with a notification.
Start of Squeeze Alerts - Opposite of the alert above, notifications come when a Squeeze begins.
Zero Line Alerts - This will inform you of when the momentum makes a bullish or bearish move across the zero line.
I hope that I've done well enough explaining the indicator and how it works, for any further information on it I suggest you check out Simpler Trading and get linked up with John Carter over there.
He does lots of videos, webinars, and of course you can always get the official indicator and his signals there too.
Compression Period Tracker [acatwithcharts]Compression Period Tracker is the companion script to Compression MA to read out the period length that is actually being tracked. It is analogous to Mean Reversion Period Tracker, and makes sense to use in the same indicator window when using the two sets of indicators together on the same chart.
My volatility indicators are available by subscription in several packages through SharkCharts.live - and this is planned to be the first new one ready to add. I plan to release a video explaining how to use this indicator coinciding with launch, as there's a lot to talk about. Videos on my other indicators are currently hosted on DadShark's YouTube channel.
Current pricing and subscription details will be kept up-to-date on SharkCharts.live
Compression Period Tracker (600 Max) [SharkCharts.live]Compression Period Tracker is the companion script to Compression MA to read out the period length that is actually being tracked. It is analogous to Mean Reversion Period Tracker, and makes sense to use in the same indicator window when using the two sets of indicators together on the same chart.
This version caps the maximum period length at 600, an empirically-chosen number based on some testing of Mean Reversion MA to try to avoid picking overly distant targets and which dramatically improves stability. In practice, it should be extraordinarily rare for compression MA to need to track something longer than 600, small TFs notwithstanding.
My volatility indicators are available by subscription in several packages through SharkCharts.live - and this is planned to be the first new one ready to add. I plan to release a video explaining how to use this indicator coinciding with launch, as there's a lot to talk about. Videos on my other indicators are currently hosted on DadShark's YouTube channel.
Current pricing and subscription details will be kept up-to-date on SharkCharts.live
Compression MA (600 Max) [acatwithcharts]Compression MA is an experimental indicator which modifies Mean Reversion MA with a twist: it instead tracks the most compressed period on a given timeframe as a target for eventual mean reversion. This is a twist on the logic for trading volatility mean reversions in that here we work from the assumption that a period of compression means that there's volatility overhead that should provide resistance to a breakout. The compression MA should therefore help define range-bound areas and help predict intermediate resistances.
This required some tweaking of Mean Reversion MA rather than just making a modification to enable more features on that script, but much of the logic and settings are similar. I've also added an option on this script to turn off tracking and just give the current most compressed period, if any, which creates an entirely different chart and is great for identifying and defining areas of sideways, strongly range-bound compression, which should be scalpable.
This version caps the maximum period length at 600, an empirically-chosen number based on some testing of Mean Reversion MA to try to avoid picking overly distant targets and which dramatically improves stability. In practice, it should be extraordinarily rare for compression MA to need to track something longer than 600, small TFs notwithstanding.
My volatility indicators are available by subscription in several packages through SharkCharts.live - and this is planned to be the first new one ready to add. I plan to release a video explaining how to use this indicator coinciding with launch, as there's a lot to talk about. Videos on my other indicators are currently hosted on DadShark's YouTube channel.
Current pricing and subscription details will be kept up-to-date on SharkCharts.live
