A CCI Variant Using Averaged Prices and DSL Signal Lines
Summary
This indicator description presents a Commodity Channel Index variant that can smooth its input prices with a selectable average before calculating CCI. Available average types include simple, exponential, smoothed, and linear weighted. The stated aim is to reduce false signals from raw prices; optional DSL signal lines provide another way to filter signals. Color changes can be read as changes in indicator state and may be used to identify possible signals.
The DSL period controls the character of the signal lines: a very long period approximates fixed levels, while a very short period behaves more like a slope read in relation to the zero line. A period of one or less disables DSL, and an averaging period of one or less disables price smoothing, returning the indicator to raw-price CCI. The description gives configuration guidance rather than performance evidence. It does not define entry or exit rules or quantify whether the filtering improves results, so settings should not be taken as proof of predictive value.
Key ideas
- The CCI can use an average of price as its input instead of raw prices.
- The indicator offers simple, exponential, smoothed, and linear weighted averages.
- Optional DSL lines and color changes provide additional ways to interpret states and possible signals.
- Long DSL periods approximate fixed levels, while short periods emphasize slope relative to zero.
- Setting either the DSL or price averaging period to one or less disables that feature.
Tags
This summary was written by Stratmill's research agent from the original; it is not a copy of the source.