Momentum Lock (Overlay)

The Momentum Lock (Overlay) indicator is a trend-following tool designed to identify precision entry points by combining momentum filtering with trend confirmation and stochastic exhaustion levels. It aims to provide high-probability signals while incorporating strict discipline rules to prevent overtrading within a single trend.

Usage

The indicator can be used to identify trend direction and potential reversal or continuation points within that trend. The core logic relies on the alignment of multiple timeframes and momentum calculations:

• Trend Identification: The Hull Moving Average (HMA) defines the primary trend. When the HMA is green, the bias is bullish; when red, the bias is bearish.
• Momentum Filtering: The TRIX oscillator acts as a momentum filter. Trade signals are only generated when the TRIX direction aligns with the HMA trend (rising for longs, falling for shorts).
• Execution Triggers: Signals are generated based on Stochastic "reload" zones. A buy signal occurs when the Stochastic K line dips below the lower limit (default 48) during a bullish trend. A sell signal occurs when it rises above the upper limit (default 52) during a bearish trend.
• Pulse Re-Entry: If the primary momentum is lost briefly but quickly realigns with the trend, the script provides a "pulse" signal to capture the continuation.

Details

The script executes a multi-layered calculation process to ensure signal quality:

1. HMA Calculation: Utilizes a weighted moving average approach to reduce lag while maintaining smoothness.
2. TRIX Calculation: Employs a triple-smoothed exponential moving average of the log price to isolate significant momentum shifts.
3. Virtual Trade Logic: Unlike standard indicators, this tool tracks "virtual trades" to enforce discipline. It monitors wins within a specific trend and can lock out further signals if a "loss" (momentum flip against the entry price) is detected or if a maximum number of winners per trend is reached.

Settings

Trend Settings

• HMA Period: Sets the lookback period for the Hull Moving Average trend line.
• HMA Divisor: Adjusts the internal calculation of the HMA; lower values increase sensitivity.
• TRIX Length: Determines the lookback for the momentum filter.

Stochastic Trigger

• K Length: The period for the Stochastic calculation.
• K Smoothing: The smoothing factor applied to the Stochastic K line.
• Upper Limit (Sell): The threshold (default 52) that the Stochastic must cross over to trigger a sell signal.
• Lower Limit (Buy): The threshold (default 48) that the Stochastic must cross under to trigger a buy signal.

Discipline Rules

• Max Wins Per Trend: The maximum number of successful signals allowed before the indicator stops generating new signals for the current trend.

FAQ

How do I interpret the HMA color changes?

The HMA changes from green to red based on the trend direction. If it turns gray, it indicates a "loss lockout" or that the maximum wins for that trend have been reached, signaling the user to wait for a trend reset.

What is the "Trix Bias" background?

The background coloring represents the immediate momentum direction of the TRIX. Green indicates rising momentum, while red indicates falling momentum, serving as a secondary visual confirmation for the primary signal.

How can I access Momentum Lock (Overlay)?

You can get access on the LuxAlgo Library for charting platforms like TradingView, MetaTrader (MT4/MT5), and NinjaTrader for free.