Squeeze Momentum Indicator [LazyBear] vHMA

The Squeeze Momentum Indicator [LazyBear] vHMA tool is a volatility and momentum oscillator that identifies periods of market consolidation and explosive breakouts by utilizing the relationship between Bollinger Bands and Keltner Channels.

Usage

The indicator consists of a histogram and a series of crosses on the zero line to help traders identify the market's current state:

• Squeeze Detection: Black crosses on the midline indicate a "Squeeze" state, where Bollinger Bands are trading within the Keltner Channels. This signifies low volatility and a market preparing for a significant move.
• Squeeze Release: Gray crosses indicate the release of the squeeze, often serving as a signal for an upcoming trend.
• Momentum Histogram: The histogram colors represent the direction and strength of the momentum. Bright green or bright red bars indicate strengthening momentum, while darker shades indicate weakening momentum.
• Trade Execution: A common strategy involves waiting for the first gray cross after a squeeze period and entering a trade in the direction of the momentum histogram.

Details

This tool is a derivative of John Carter's "TTM Squeeze" indicator. This specific version replaces standard Simple Moving Averages (SMA) with Hull Moving Averages (HMA). The HMA is designed to reduce lag while maintaining smoothness, making the squeeze detection and momentum calculations more responsive to recent price action. The histogram is calculated using a linear regression of price relative to the average of the high/low range and the HMA.

Settings

• BB Length: Determines the period used for Bollinger Bands calculations.
• BB MultFactor: Sets the standard deviation multiplier for the Bollinger Bands width.
• HMA Length: Sets the period for the Hull Moving Average used as the basis for the calculations.
• Source: The price data point used for calculations (e.g., Open, High, Low, Close).
• KC Length: Determines the period used for Keltner Channel calculations.
• KC MultFactor: Sets the multiplier for the Keltner Channels range.
• Use TrueRange (KC): When enabled, uses True Range for Keltner Channel calculations instead of the simple High-Low range.

FAQ

How do I interpret the zero-line crosses?

Crosses on the zero line indicate volatility levels. A black cross signifies a squeeze (low volatility), while a gray cross signifies a squeeze release (potential volatility expansion).

What makes the HMA version different?

The use of the Hull Moving Average (HMA) instead of an SMA makes the indicator more responsive to price changes, potentially allowing for earlier detection of trend shifts and squeeze releases.

How can I access Squeeze Momentum Indicator [LazyBear] vHMA?

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