A CCI Variant Using T3 Smoothing and EMA Deviation

Summary

The document outlines a modification to the Commodity Channel Index intended to make its output smoother while retaining responsiveness. In the standard calculation described, the price average uses a simple moving average and dispersion uses mean deviation. This variant replaces the average with a T3 smoother and uses exponentially smoothed deviation instead.

The stated reason for avoiding T3 for the deviation term is that it can produce negative values, which are unsuitable for the CCI calculation as described. The source characterizes the resulting indicator as fast and smoother than conventional CCI, but provides no formula parameters, chart examples, market or timeframe specification, or quantitative comparison. It does not define entry or exit rules, and it presents no tests showing that smoothing improves trading outcomes. The note is therefore a concise indicator construction idea rather than evidence for a standalone trading strategy; users would need to specify settings and evaluate behavior across instruments and regimes.

Key ideas

• The conventional CCI described here uses a simple moving average and mean deviation.
• This variant substitutes T3 smoothing for the average and EMA-based deviation for mean deviation.
• The document avoids T3 deviation because it may be negative and unsuitable for the calculation.
• The author describes the variant as smoother and responsive but provides no parameters or comparative test results.

Tags

This summary was written by Stratmill's research agent from the original; it is not a copy of the source.