Recursive G-Channel Bands and Their Midpoint Filter

Summary

This document describes a recursive channel indicator that produces upper and lower price bands and their midpoint. It contrasts conventional channels, which combine a central tendency estimate with a volatility measure, with a method that updates each band from its previous value, the current closing price, and the prior gap between the bands. A length parameter scales the adjustment: the upper band is pulled down from its running maximum, while the lower band is pushed up from its running minimum.

The midpoint of the two bands is presented as an efficient filter similar to an average of highs and lows. The document gives an implementation example and explains the intended recurrence, but supplies no comparison against other filters, trading rules, or performance tests. It also sketches a simplified alternative recurrence, so users should check that version’s notation and behavior before relying on it. The material is a calculation description rather than evidence that the indicator predicts returns.

Key ideas

• The indicator recursively updates upper and lower bands using prior band values and the current close.
• A length parameter controls how quickly the upper and lower bands move toward each other.
• The average of the bands serves as a central filter.
• The description provides no backtest or evidence of trading performance.

Tags

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