The Squeeze indicators, found on this forum, look for Bollinger Bands compressed within Keltner Channels; indicating a price volatility decrease.
It has been found that this can be an early warning of a potential explosive price movement up or down.
These indicators neither predict when or if the squeeze will actually explode, nor what direction.
Typical use of the squeeze:
Squeeze indicators are best used on the highest of your timeframes.
Combine with your favorite strategy.
When your strategy signals a potential trade and your chart shows a squeeze, leverage this additional information to make a well-informed decision.
The trade could be potentially lucrative, if your sound basic strategy is signalling a buy and all three of your timeframes are lining up. But the trade might have an extended duration, and your funds will be locked up, given the uncertainty of how long it will linger in the squeeze.
Because of the possibility of extended duration, works better with swing trading.
It has been found that this can be an early warning of a potential explosive price movement up or down.
These indicators neither predict when or if the squeeze will actually explode, nor what direction.
Typical use of the squeeze:
Squeeze indicators are best used on the highest of your timeframes.
Combine with your favorite strategy.
When your strategy signals a potential trade and your chart shows a squeeze, leverage this additional information to make a well-informed decision.
The trade could be potentially lucrative, if your sound basic strategy is signalling a buy and all three of your timeframes are lining up. But the trade might have an extended duration, and your funds will be locked up, given the uncertainty of how long it will linger in the squeeze.
Because of the possibility of extended duration, works better with swing trading.
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