OskarGallard

Squeeze Momentum [Plus]

The "Momentum" in this indicator is smoothed out using linear regression . The Momentum is what is displayed on the indicator as a histogram, its purpose is obvious (to show momentum).

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 this version, I've given the freedom to change this and try out different types of moving averages.

The original squeeze indicator had only one Squeeze setting, though this new one has three.
The gray dot Squeeze, call it a "low squeeze" or an "early squeeze" - this is the easiest Squeeze to form based on its settings.
The orange dot Squeeze is the original from the first Squeeze indicator.
And finally, the yellow dot squeeze, call it a "high squeeze" or "power squeeze" - is the most difficult to form and suggests price is under extreme levels of compression.

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 - you to choose one of 5 different color schemes.
Draw Divergence - Self explanatory here, this will auto-draw divergence on the indicator.
Gray Background for Dark Mode - to make them more visually appealing.

Added ADX ( Average Directional Index ) that measure a trend’s strength. The higher the ADX value, the stronger the trend. The ADX line is white when it has a positive slope, otherwise it is gray. When the ADX has a very large dispersion with respect to the momentum histogram, increase the scale number.

Added "H ( Hull Moving Average ) Signal". Hull is a extremely responsive and smooth moving average created by Alan Hull in 2005. Have option to chose between 3 Hull variations.

Added "Williams Vix Fix" signal. The Vix is one of the most reliable indicators in history for finding market bottoms. The Williams Vix Fix is simply a code from Larry Williams creating almost identical results for creating the same ability the Vix has to all assets.

The VIX has always been much better at signaling bottoms than tops. Simple reason is when market falls retail traders panic and increase volatility , and professionals come in and capitalize on the situation. At market tops there is no one panicking... just liquidity drying up.

The FE green triangles are "Filtered Entries"
The AE green triangles are "Aggressive Filtered Entries"
Release Notes: Small modification in the ADX chart.

Added "Wilder's Moving Average" in the Squeeze.

Momentum and Squeeze now have separate source and period.
Release Notes: 👍🏻
Open-source script

In true TradingView spirit, the author of this script has published it open-source, so traders can understand and verify it. Cheers to the author! You may use it for free, but reuse of this code in a publication is governed by House Rules. You can favorite it to use it on a chart.

Want to use this script on a chart?

Comments

Thanks for your work buddy
+3 Reply
Thanks for your effort. Excellent!
+2 Reply
very nice thanks. Is it correct that we only see Filtered Entry indicator / Hull for entry but only Hull indicator for exits?
+2 Reply
@publow, That's right, the "Vix Fix" indicator shows only entries
+2 Reply
Very nice idea ...... Thanks for sharing
+2 Reply
Hi, can you add "EWO Breaking Bands"?
+1 Reply
Very nice indicator, thank you !!
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Oskar when price reverses after drop & large red squeeze to a small green squeeze, but the ADX is near 0 and actually turns slightly negative.
should this be interpreted that the price strength up is weak & likely to reject again?

Just trying to understand how to best trade with all the different indicators you have put together in sync.
Example use case is Bitcoin last 12 hours.
Reply
@publow, Hi! I am going to explain some considerations:

Look for two major timeframes to be in Squeeze, this shows price congestion and you get higher probability of larger move. For example, when both daily and 4 hour are in a Squeeze; and the 4 hour Squeeze fires off, it gives you oppty to get in a move where the daily might fire off by the time the 4 hour move ends. As with 90% of Indicators the larger the timeframe the more reliable and Larger the move.

Another thing to note is you want Momentum to be going in same direction on both timeframes when the lower time frame fires. So in a move to the upside you would want your daily Momentum to rise alongside the Weekly Momentum. Doesn't matter if the weekly Momentum is below zero, you just want it heading higher (from dark red to green).

ADX identify Momentum strength. For example, if the Momentum decreases (dark green) and the ADX (> 23) develops a negative slope, it indicates a possible range or fall.
Positive slope (white): ADX growing
Negative slope (gray): ADX falling
If the ADX remains below the 23 level it means that there is no interest, that is, the Momentum is weak.

PS: In the indicator the level 23 of the ADX coincides with the zero level of the Momentum.
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Very useful indicator!

But with some coins of very low value I wasn't able to get it to display anything right.

Example:
SHIBUSDT

What's the right way to configure the indicator to work properly?

Thank you for sharing
Reply