Momentum Ghost Machine

The Momentum Ghost Machine indicator utilizes a windowed sinc low-pass filter to create a highly stable and accurate momentum oscillator designed to reduce noise and false readings compared to traditional Rate of Change (ROC) tools.

Usage

The Momentum Ghost Machine can be used to identify trend direction, exhaustion, and potential reversals through its oscillator and histogram output.

• Trend Identification: When the momentum line is above zero, the trend is generally considered bullish. Conversely, values below zero indicate a bearish trend.
• Momentum Strength: The histogram represents the difference between the momentum line and its moving average. Expanding histogram bars suggest strengthening momentum, while contracting bars suggest a potential slowdown.
• Ghost Mode (Projections): By enabling "Ghost Mode," the indicator uses linear extrapolation to project the potential future path of both the momentum line and the signal line, helping traders anticipate crossovers before they occur.
• Candle Coloring: The indicator offers three coloring modes (Direct, MA, and Both) to sync price action with oscillator states. For example, "Direct" mode colors candles based on whether momentum is positive/negative and increasing/decreasing.

Details

Unlike standard momentum indicators that use raw price data—which is often noisy—this tool employs a windowed sinc low-pass filter. This is a linear phase filter that removes high-frequency noise without distorting the shape of the underlying signal. Because filters require a sample window to calculate, they naturally introduce a time delay; this indicator leverages that delay to compare current price data against a high-quality, filtered version of past price action. This results in a much smoother signal that maintains the structural integrity of price movements.

Settings

Settings

• Source: The price data used for calculations (default is Close).
• Momentum Length: Determines the lookback period for the momentum calculation.
• Momentum Smoothing: Controls the frequency cutoff of the windowed sinc filter. Higher values result in a smoother signal without changing the indicator's period.
• Post Smoothing: Applies additional smoothing to the final momentum output.
• Post Smoothing Style: Selection of moving average types for post-smoothing (EMA, SMA, WMA, etc.).
• MA Length: The lookback period for the signal line (moving average of the momentum).
• MA Style: Selection of moving average types for the signal line.

Style

• Ghost Mode: Enables or disables the linear projection of the oscillator.
• Candle Color Style: Choose between MA-based coloring, Direct momentum coloring, a combination of Both, or None.
• Glow: Toggles a visual glow effect for the plots.

FAQ

How do I interpret the Projected Delta?

The Projected Delta (Ghost Mode) displays two future histogram bars based on current linear extrapolation. These bars help visualize if the momentum is likely to continue its current trajectory or if a crossover with the signal line is imminent.

What is the advantage of Windowed Sinc filtering?

Traditional smoothing (like a simple MA) often lags significantly or distorts the price curve. The windowed sinc filter provides a faithful reconstruction of the signal's shape while effectively removing the "noise" that causes false signals in standard ROC oscillators.

How can I access Momentum Ghost Machine?

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