Twin Range Filter Indicator for Smoothed Directional Signals

Summary

This indicator experiment combines two range filters with different lookback periods and multipliers, then averages their smoothed range estimates. It uses that combined range to update a trailing filter around price. The filter’s direction and price position determine bullish or bearish states, with arrows marking state changes. The included settings use a faster period of 27 and a slower period of 55, with respective range multipliers of 1.6 and 2.

The author says the combination performs better than a typical ATR setup, but supplies no supporting tests or performance measurements. The description also acknowledges that the signals remain noisy and should not be used unattended in automated trading. It recommends treating the indicator as a component of a broader system with additional filters. As presented, it is a directional signal tool rather than a complete strategy: position sizing, exits, market selection, and evaluation across different conditions are not specified.

Key ideas

• The indicator averages range estimates from fast and slow filters to smooth its directional signal.
• A trailing filter is updated around price, and its slope helps define bullish or bearish states.
• Arrows mark transitions between the two directional states.
• The author reports persistent noise and recommends adding filters before using the indicator in a trading system.
• No test results or evidence are provided to substantiate the comparison with ATR.

Tags

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