The Squeeze Momentum Indicator is a trading tool that was initially based on John Carter’s “TTM Squeeze” volatility indicator. This financial instrument is used in Forex trading and other financial markets to indicate periods of low volatility, known as a ‘squeeze’, and the subsequent release from this squeeze.
The Squeeze Indicator: A Key to Low Volatility Trading
In the realm of financial markets, the Squeeze Momentum Indicator is represented by a gray dot on the midline, signaling that the market has entered a squeeze. This is a period where Bollinger Bands are within the Keltner Channel, indicating a time of low volatility. This period of calm is often seen as the market gearing up for a significant move, either upwards or downwards.
The Squeeze Release: Timing your Trade
A blue dot on the indicator signifies a “Squeeze release”. Following John Carter’s advice, traders should wait for the first blue dot after a gray one and then take a position in the direction of the momentum. For instance, if the momentum value is above zero, then it would be advisable to go long. Traders should then exit the position when the momentum changes, which is often indicated by a color change.
Enhancing the Indicator with Additional Tools
Experience in volatility trading suggests that pairing the Squeeze Momentum Indicator with another tool like the ADX or WaveTrend can help avoid missing optimal entry points. While Carter uses a simple momentum indicator, some traders might prefer using a different method, such as linreg-based, to plot the histogram.
Optimal Use of the Indicator
This indicator shows its true potential when two or more timeframes are in a squeeze. For example, if both 15-minute and 5-minute periods are in a squeeze period, entering a trade in the direction of the movement when the 5-minute period is released from the squeeze could yield positive results.
FAQ
Where can I find more information about the Squeeze Momentum Indicator?
There are numerous resources available online that provide a detailed explanation of the Squeeze Momentum Indicator and how to use it best. A simple search for “TTM Squeeze” or “Squeeze Momentum” will yield a wealth of articles.
Where can I see this product in action?
Independent testing of the Squeeze Momentum Indicator can be viewed on forexroboteasy.com. Additionally, you can subscribe to updates on the results of testing this product.
Can I share my experience with this product?
Yes, users are encouraged to share their experiences using the Squeeze Momentum Indicator to further enrich the trading community’s understanding of this tool.
This review is independent and does not endorse any particular product. The Squeeze Momentum Indicator is a tool used in financial markets and its effectiveness can vary depending on market conditions and individual trading strategies.
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