This indicator is based on a strategy mentioned in John Carter's book, Mastering the Trade. The basic idea
behind the strategy is that markets tend to move from periods of low volatility to high volatility and
visa versa. The strategy aims to capture moves from low to high volatility.
For gauging this he uses two
common indicators - Bollinger Bands and Keltner Channels (ok, not so common!). He also uses the Momentum
indicator to provide a trade bias as some as the Bollinger Bands come back outside the Keltner Channels.
The Squeeze_Break indicator combines this into a signal indicator and has the following components:
The Acceleration/Deceleration Indicator (AC) measures acceleration and deceleration of the current driving force.Average Directional Movement Index (ADX)
The Average Directional Movement Index Indicator (ADX) helps to determine if there is a price trend.