QQE: Combining Smoothed RSI, Adaptive Bands, and Momentum Filters

Summary

The document explains a QQE indicator that uses two smoothed RSI calculations to assess momentum and possible trend changes. The first RSI is wrapped in volatility-adjusted trailing bands; crossing a band marks a potential shift. The second RSI confirms direction relative to its midpoint. Bollinger Bands on the first RSI add an overbought or oversold filter, and the main histogram highlights signals only when momentum and band-break conditions align.

It also describes how to read the histogram, a trend line derived from the second RSI, and a background momentum histogram together. Suggested parameter adjustments distinguish lower from higher chart timeframes, but the document offers no performance statistics or comparative tests. It presents the indicator as a confirmation tool or momentum signal, not as a standalone trading system. Signals indicate possible changes in momentum or trend; they do not establish that a reversal will follow, and the parameter suggestions require instrument-specific evaluation.

Key ideas

• QQE smooths RSI and compares it with adaptive bands to flag possible momentum shifts.
• A second RSI gauges directional momentum relative to its midpoint.
• The main histogram requires both a momentum threshold and a Bollinger Band breakout.
• The trend line and background histogram add context but are not standalone signals.
• The document gives parameter suggestions but provides no measured performance evidence.

Tags

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