QQE Threshold Indicator: Smoothed RSI Bands and Signal Zones

Summary

The document explains a QQE variant that smooths RSI and builds adaptive trailing bands from the volatility of the smoothed RSI. The band distance is scaled by a configurable factor, while upper and lower threshold zones mark stronger positive or negative readings. The description also outlines signal markers for crossings of the bands, the RSI midpoint, and threshold boundaries, plus a histogram that distinguishes bullish, bearish, and neutral regions.

Suggested uses include confirming trend direction, spotting possible momentum reversals or exhaustion, and filtering signals alongside other indicators. Parameters let users adjust RSI length, smoothing, band width, thresholds, and which markers appear. The document provides indicator logic and example defaults, but no performance tests or evidence that the signals are profitable. Threshold extremes are framed as possible overbought or oversold conditions, so they are alerts for interpretation rather than guaranteed reversals; settings may need adjustment for an asset or timeframe.

Key ideas

• The indicator smooths RSI and derives trailing bands from the changing RSI values.
• A multiplier controls the distance between the smoothed RSI and its adaptive bands.
• Signals mark band crosses, midpoint crosses, and moves beyond upper or lower threshold zones.
• The histogram colors readings according to their position relative to the thresholds.
• The document describes potential uses but gives no backtest or proof of profitability.

Tags

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