Use the updated source instead of the what TV shows below.
[---- Original Notes ----]
This is a derivative of John Carter's "TTM Squeeze" volatility indicator, as discussed in his book "Mastering the Trade" (chapter 11).
Black crosses on the midline show that the market just entered a squeeze (Bollinger Bands are with in Keltner Channel). This signifies low volatility, market preparing itself for an explosive move (up or down). Gray crosses signify "Squeeze release".
Mr.Carter suggests waiting till the first gray after a black cross, and taking a position in the direction of the momentum (for ex., if momentum value is above zero, go long). Exit the position when the momentum changes (increase or decrease --- signified by a color change). My (limited) experience with this shows, an additional indicator like ADX / WaveTrend, is needed to not miss good entry points. Also, Mr.Carter uses simple momentum indicator, while I have used a different method (linreg based) to plot the histogram.
More info: - Book: Mastering The Trade by John F Carter
Hey @Tpix, Have you tried using this indicator...It appear quite effective n i like how its not all over the place,any advice??..
Tpix
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@Clarenceaux, Yes - it's a good one. Watch the youtube video to ensure that you align like colors to properly see your squeeze and squeeze release in your chart to get the most out of it visually...