DMH: Modernizing Directional Movement with Hann Windowing

Summary

The document introduces the DMH, an updated directional movement indicator described in John Ehlers’s December 2021 TASC article. Its central change is the use of Hann windowing to modernize the traditional directional movement approach, which was originally developed when complex calculations were more difficult to implement. The indicator defaults to a 14-bar period, following Wilder’s convention, but the author suggests that traders select or optimize the period for their own use.

The note also describes optional visual variants: colors can change when the indicator’s slope changes or when it crosses the zero line, or the original no-color-change display can be retained. These are presentation choices that might be used as signals, not demonstrated trading rules. The document gives no test results or evidence that DMH improves performance; it recommends experimenting with the period before applying the indicator in a strategy.

Key ideas

• DMH applies Hann windowing to update the traditional directional movement indicator.
• Its default period is 14 bars, but traders may choose or optimize another length.
• Optional color changes can mark slope shifts or zero-line crossings.
• The document offers no performance evidence and advises testing the period before use.

Tags

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