TEMA/hullMA Ribbon with Bollinger Bands

The TEMA/hullMA Ribbon with Bollinger Bands indicator provides a comprehensive trend-following and volatility analysis tool by combining Triple Exponential Moving Averages (TEMA) and Hull Moving Averages (HMA) with adaptive Bollinger Bands. It aims to help traders identify trend direction, momentum shifts, and potential reversals through a visual ribbon and volatility envelope system.

Usage

The script is primarily designed for shorter timeframes and utilizes visual cues to determine market sentiment:

• Moving Average Ribbon: The space between the TEMA and the Hull MA forms a ribbon. When the ribbon is green (bullish), the TEMA is above the Hull MA, suggesting an uptrend. When the ribbon is red (bearish), the TEMA is below the Hull MA, suggesting a downtrend.
• Ribbon Pinch: When the TEMA and Hull MA converge (the ribbon "pinches"), it often signals a potential trend exhaustion or an upcoming reversal.
• Bollinger Bands: These bands surround the price action and are calculated using the TEMA's True Range and an RMA-based basis. They serve as dynamic support and resistance levels.
• Trend Continuation: Consistent price action above the basis line within the bands suggests trend strength, while breaks outside the bands may indicate overextended conditions.

Details

This tool implements a unique approach to volatility by using the TEMA (Triple Exponential Moving Average) to calculate the True Range used within the Bollinger Band formula.

• TEMA Calculation: It uses a triple-smoothed EMA to reduce lag while maintaining responsiveness to price changes.
• Hull MA: The Hull Moving Average is included to provide a smoother, lag-reduced baseline for trend comparison.
• Volatility Logic: Unlike standard Bollinger Bands that use standard deviation of price, this version incorporates a specialized True Range derived from TEMA values (High, Low, and Close) to adjust the bands' width, making them more sensitive to momentum-driven volatility.

Settings

General Settings

• Fast TEMA: Sets the period for the Triple Exponential Moving Average calculation.
• Slow Hull MA: Sets the period for the Hull Moving Average.
• BB Length: Determines the lookback period for the Bollinger Band basis (RMA) and standard deviation.
• BB stdev Mult: Adjusts the multiplier for the Bollinger Band width.
• Source: Defines the price data used for the calculations (default is Close).

FAQ

How do I interpret the ribbon color changes?

A change from red to green indicates a bullish crossover (TEMA crossing over Hull MA), while a change from green to red indicates a bearish crossunder.

Can I use this for long-term trading?

While designed for shorter timeframes due to the responsive nature of TEMA and Hull MA, the settings can be adjusted for higher timeframes by increasing the period inputs.

How do I access the TEMA/hullMA Ribbon with Bollinger Bands?

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