Using DEMA to Reduce Lag in a Super Smoother Indicator

Summary

The document explains a “zero lag” super smoother built by applying the double exponential moving average (DEMA) adjustment to a super smoother. It places the name in context: “zero lag” is commonly used for averaging methods adjusted to respond with less delay, rather than meaning that an indicator has no lag at all.

Because the underlying super smoother already smooths price data, the adjusted indicator is also described as smooth and as filtering some signals. The suggested use is to treat changes in the indicator’s color as trading signals. The document provides no formula, parameter settings, chart examples, backtest, or performance evidence, so it does not establish how the signals behave across markets or time periods. Traders would need to define entry and exit rules and test the indicator, including its lag and false signals, before relying on it.

Key ideas

• The indicator applies a DEMA-style adjustment to a super smoother to reduce lag.
• The phrase “zero lag” describes an attempt to reduce delay and does not establish that all lag is removed.
• The document says the resulting indicator remains smooth and filters some signals.
• Color changes are proposed as signals, but the document provides no performance evidence or detailed trading rules.

Tags

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