Reducing Trend Indicator Noise with Jurik Moving Average Smoothing

Summary

The document describes a smoothed version of a trend direction and force indicator. Its stated motivation is that the original indicator can produce too many signals in some situations, making them harder to use for trading decisions.

The proposed adjustment applies Jurik smoothing, which the document characterizes as producing smooth output with low lag. The intended benefit is to make the indicator's signals more reliable by reducing noise while retaining responsiveness. The text offers no formula, parameter settings, chart examples, backtest, or performance figures, so it does not show whether the smoothing improves results across markets or timeframes. Traders would need to test how it affects signal frequency, timing, and false signals before relying on it.

Key ideas

• The trend direction and force indicator may generate more signals than a trader finds useful.
• Jurik smoothing is added to smooth the indicator while aiming to limit lag.
• The stated goal is to make the resulting trading signals more reliable.
• The document provides no empirical evidence or implementation details to assess that claim.

Tags

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