The momentum histogram can also be used to determine specific exit points. When the histogram changes direction and starts moving back towards the zero line, that is a signal to sell. Price moves after a squeeze fires tend to last for 8-10 bars. In addition, a bar that is lower than the previous bar will be a darker color (dark blue or dark red), and a bar that is higher than the previous bar will be a lighter color (light blue or light red). Bars above the zero line are blue and below the zero line are red. The histogram bars are color coded for ease of interpretation. If the momentum is above the zero line and rising (light blue bars), buy long if the histogram is below the zero line and falling lower (dark red bars), that indicates a shorting opportunity. The momentum histogram helps to determine the direction in which to trade. Carter recommends buying on the first green dot after one or more red dots. When volatility increases and the Bollinger Bands expand until they are outside of the Keltner Channels, the squeeze has “fired” and the squeeze dots will be green. While volatility levels are low, the squeeze dots will be red. The Squeeze dots signal when volatility conditions are right to buy the momentum histogram indicates the direction (long or short) in which to trade. The Squeeze Momentum PRO has both volatility and momentum components. This histogram oscillates around the zero line increasing momentum above the zero line indicates an opportunity to purchase long, while momentum falling below the zero line can indicate a shorting opportunity. The Squeeze Momentum PRO also uses a momentum oscillator to show the expected direction of the move when the squeeze fires. The on/off state of the squeeze is shown with small dots on the zero line of the indicator: red dots indicate the squeeze is on, and green dots indicate the squeeze is off. When the Bollinger Bands expand and move back outside of the Keltner Channel, the squeeze is said to have “fired”: volatility increases and prices are likely to break out of that tight trading range in one direction or the other. If the Bollinger Bands are completely enclosed within the Keltner Channels, that indicates a period of very low volatility. The volatility component of the Squeeze Momentum PRO measures price compression using Bollinger Bands and Keltner Channels. Squeeze Momentum PRO is based on TTM Squeeze that is a volatility and momentum indicator introduced by John Carter of Trade the Markets (now Simpler Trading), which capitalizes on the tendency for price to break out strongly after consolidating in a tight trading range. OVERVIEW – Squeeze Momentum PRO for Ninjatrader 8 Open to feedback, questions, improvements, errors etc.Video Demonstration of Squeeze Momentum PRO Once you enable custom date backtesting, you will see lines on the chart which can be dragged left right based on where you want to start and end the backtesting from and to. One of most crucial aspects while optimizing for backtesting is to check a strategies performance on uptrends, downtrend and sideways markets seperately as to understand the weak points of strategy. In this case it would be much more feasible to disable "Short" Trading and see results of Long Only as a built in graphic view of backtestor provides a more easy to understand data feed as compared to the performance summary in which you have to review long and short profitability separately. Many markets dont allow short trades, or are not suitable for short trades. 3) Enable and Disable Toggles of Long and Short Trades Once that is done, we should start optimizing for Long and Short TP's separately, starting with Longs first in both cases. Hence once we have a profitable backtesting setting, then we should start optimizing Long and Short SL's seperately. Many markets/pairs, go down with much more speed then they go up with. In strategies there is usually only 1 SL and 1 TP, and it is assumed that if a 2% SL giving a good profit %, then it would be best for both long and short. Zero Crossover Line (BUY signal when crossover zero line, and SELL crossdown zero line) 2) Long Short TP and SL LazyBear (I have made this simple by using Kivanc technique of Momentums Moving Average Crossover, BUY when MA cross above signal line, SELL when crossdown signal line) There was no proper strategy that would allow backtesting on which further analysis could be carried out.ġ ) Strategy Logic (easily toggleable from the dropdown menu from strategy settings) The original Squeeze Momentum Strategy did not have buy sell signals and there was alot of confusion as to when to enter and exit. Used strategy template with Take Profit, Stop Loss and Enable/Disable TogglesĪll credit goes to above Problem with original version: Taken inspiration from for its buy sell calculations, Modified version of Squeeze Momentum Indicator by to version 5,
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