Hull Moving Average + Bollinger Bands

The Hull Moving Average + Bollinger Bands indicator provides a comprehensive trend-following and volatility analysis framework by combining the fast-reacting Hull Moving Average (HMA) with Bollinger Bands, Keltner Channels, and Parabolic SAR. This multi-layered tool helps traders identify momentum shifts and potential mean reversion opportunities when the HMA interacts with the outer volatility bands.

Usage

The Usage section describes how the script can be used to identify trend direction and potential entry points. The primary strategy involves monitoring the relationship between the HMA and the volatility bands.

• Trend Identification: The HMA changes color based on direction—green for bullish momentum and red for bearish momentum. Traders can use the HMA's position relative to the price to determine short-term trend strength.
• Volatility Squeezes: By plotting both Bollinger Bands and Keltner Channels, the tool visualizes "squeezes." When the Bollinger Bands (outer lines) contract within the Keltner Channels (shaded area), it indicates a period of low volatility often followed by a significant price breakout.
• Reversal Signals: Buying or selling opportunities are often sought when the HMA reaches the outer Bollinger Bands. The script includes optional "crossplot" circles that mark specific interactions between the HMA and price action during established trends.
• Parabolic SAR: When enabled, the Parabolic SAR provides additional trailing stop-loss levels and trend confirmation dots.

Details

The script integrates several technical analysis concepts to reduce lag while maintaining volatility context:

1. Hull Moving Average (HMA): Utilizes weighted moving averages to significantly reduce lag while improving smoothing, making it more responsive to price changes than a standard SMA.
2. Volatility Bands: The script calculates Bollinger Bands using a standard deviation multiplier and Keltner Channels using Average True Range (ATR). The visual thickness of the Bollinger Bands changes dynamically based on their position relative to the Keltner Channels.
3. Signal Logic: The buy and sell signals are generated based on the HMA crossing price levels combined with specific directional requirements (falling or rising HMA over a 4-bar lookback).

Settings

• Price: Sets the source data used for all calculations (default is Close).
• Hull length: Adjusts the period for the Hull Moving Average calculation.
• Bollinger length: Determines the lookback period for the Bollinger Bands basis line and standard deviation.
• Bollinger Multiplier: Sets the number of standard deviations for the width of the outer bands.
• Keltner length: Adjusts the period for the Keltner Channel EMA and ATR calculations.
• Keltner Multiplier: Sets the ATR multiplier for the Keltner Channel width.
• SAR Settings (Start/Increment/Maximum): Controls the sensitivity and acceleration of the Parabolic SAR dots.
• Show SAR: Toggles the visibility of the Parabolic SAR on the chart.
• Show crossplot: Toggles the visibility of buy/sell circle markers based on HMA and price crossovers.

FAQ

How do I interpret the HMA color changes? The HMA turns green when the value is increasing, suggesting bullish momentum, and red when decreasing, suggesting bearish momentum.

What does the shaded area represent? The shaded area represents the Keltner Channels. Comparing the width and position of the Bollinger Bands to this shaded area helps identify volatility breakouts.

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