TTM Squeeze & Momentum by Drecken

This is one of five indicators created to identify periods of consolidation and watch the overall market momentum to help forecast the market direction and await a release of market energy.

TTM Squeeze Overlay shows Bollinger Bands and Keltner Channels. When the Bollinger Bands (purple) go inside of the Keltner Channel (yellow), the market is said to be in a squeeze.

The dots across the zero line of the TTM Squeeze & Momentum indicator will turn red, signifying this period market compression. Once the Bollinger Bands move outside of the Keltner Channel, a squeeze has “fired”. In order to determine the direction of the move, look at the histogram of the TTM Squeeze & Momentum. If it is above zero, the squeeze has fired long, otherwise short.

The A, B and C Waves use various moving averages and oscillators to visualize the overall strength and direction of the market on short, medium and long time frames. The C Wave is often viewed as the “anchor” for the market. If this wave is clearly positive with all bars above the zero line, we would avoid short trades as this is an indication that the overall momentum of the market is long. The opposite would also be true if the wave was clearly negative. When a squeeze fires, we want to see that Waves are in agreement with the direction of the signal. If a squeeze fires short but the waves are clearly positive and showing bullish momentum, we may opt not to take the signal since it would be fighting the overall market trend.
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