Catch Breakouts Before They Happen - Squeeze Momentum Indicator

this breakout strategy I'm about to show you is one of the highest win rate strategies you can possibly do in trading it's very easy to use Works in almost every single market and most importantly it makes money well enough talk let's dive straight into it breakout strategies are one of my favorite strategies I like to do in trading but not all breakout strategies are created equal some may work well in certain market conditions but fail miserably in other market conditions that's why I want to introduce you to a powerful indicator that can help you catch breakouts before they even happen this quiz momentum indicator to add it to our charge we're going to click on indicators then click on community scripts then click on top then select the very first indicator this one by lazybear now you may be thinking why didn't we just search for the indicator why go through all those steps well this indicator is the most liked indicator on trading view as of today it has just over 83 000 likes and the only way to know that there is no any other indicator with more likes than this one is by sorting them based on number of likes so this is the squeeze momentum indicator there are a few elements that are not visible because of the dark mode on trading view so let's change the settings to make sure everything's visible to do that just click here or the style tab change color 1 to Orange and increase the opacity to 100 percent then change color 2 to White then increase the opacity to 100 percent then click here and change the display style to circles then here you're going to increase color zeros opacity to 100 and increase color 2's opacity to 100 and then click OK The Squeeze momentum indicator is a derivative of another indicator called TTM squeeze which was created by John F Carter a well-known Trader and author this indicator is designed to identify periods of consolidations in the market which typically precede a significant breakout move it's based on the premise that when the market is in a period of consolidation it's like a spring being compressed and when that spring is released it can lead to a super powerful momentum move in One Direction now let's explore this indicator as you can see here it's made up of several different components we have this bright green and dark green bars then down here we have this bright red and dark red bars also in the middle here we have this orange and white dots The Squeeze momentum indicator measures two different things in the market momentum and volatility this histogram represents bullish and bearish momentum the green bars represent bullish momentum and these red bars represent bearish momentum for the strategy we're going to do in this video we will only trade in the direction of Market momentum then these dots sitting on the Zero line indicate Market volatility these orange dots indicates that the market is in a squeeze that basically means that the market is consolidating or moving sideways hence low volatility when the market breaks out of the consolidation phase and the volatility increases the dots change color from Orange to White the traditional way of using this indicator to trade is like this when these dots change color from Orange to White and the histogram bar is bright green you take a long trade and when the dots change color from Orange to White and the histogram bar is bright red you take a short trade however using this indicator to trade this way is just okay to be honest in order to take our strategy from being okay to great we need to add two more indicators to the Chart the first one is called moving average this one under technicals and the second one is called support and resistance levels with brakes this one by Lux algo double click on the moving average to access the settings on the inputs tab change the length to 200 then on a style tab change the color to whatever you want then double click on the support and resistance indicator and on the style tab change the resistance color to Green and then change the support color to red so here's how we're going to combine these three indicators to create our profitable trading strategy the most important thing is Trend confirmation and this moving average is going to be used for that the dots of this quiz momentum indicator are going to be used as Buy cell entry signals then we're going to use the squeeze momentum histogram to ensure that we're only trading in the direction of Market momentum then our final entry confirmation is going to be a break outside of a support or resistance level and the Lux algo support and resistance indicator is going to be used for that now we're going to explore the conditions needed for entering trades with this strategy but before that what broker do you guys use to trade personally I use handker trade as you can see here this is my trading history I mainly Scott gold and up here you can see that it's a live account the reason why I love hanker trade so much is because of their extremely low commissions and spreads on Forex for example the spreads can go as low as 0.0 Pips which is the lowest it can go for those of you who love High leverage hanker trade offers up to 500x leverage which basically means that my a thousand dollar deposit could have the buying power of 500 000 which is really insane and if that's not enough they're also going to give you a 100 bonus for all your deposits up to twenty five thousand dollars so if you deposit say five hundred dollars they're gonna give you a bonus of 500 so you'll have a thousand dollars to trade with to get access to the bonus as well as all the other perks sign up to hang or trade using the link in the description of this video now back to the video to enter a long trade first the market should be trading above the moving average to indicate that it's in a bullish Trend second the price must break and close above the resistance Zone represented by this green line let's extend it to the right by adding a horizontal line right here the third condition is that the squeeze momentum histogram should be colored bright grain like it is right here to indicate that the market has a high enough bullish momentum to push the price in the direction of our trade if it's colored dark green like it is right here we simply skip that setup then lastly on this quiz momentum indicator we need to have at least six consecutive orange dots followed by a single white dot this white dot signifies an increase in volatility which basically indicates that the market is starting to break out of a squeeze or a consolidation phase this is our entry signal we're going to enter a long trade here that our stop loss below the most recent swing low for the take profit we're going to set it at two times the risk we let this trade run and take profit one thing to note about this strategy is that this white dot doesn't need to align with the break of the resistance level if it doesn't come by the time this breakout happens you just wait for it on the next few candles but up to a maximum of four candles after the breakout if it comes later than 4 candles after the breakout you simply skip that setup Let Me Show an example as you can see here the market was trading above the moving average then the price broken closed above the resistance level but the dots were still colored orange we fast forward for a bit and then four candles later we see that the dots finally changed color to white we also see that the squeeze momentum histogram was colored bright green so this becomes our entry candle if you like this video so far take a second and hit that like button below it really means a lot now what are the conditions for entering a short trade well let me explain first the market should be trading below the moving average to indicate that it's in a bearish trend second the price must break and close below the support level represented by this red line let's extend it to the right by adding a horizontal line right here the third condition is that the squeeze momentum histogram should be colored bright red like it is right here to indicate that the market has enough bearish momentum to push the price in the direction of our trade if it's colored dark red like it is right here we simply skip that setup then lastly on this quiz momentum indicator we need to have at least six consecutive orange dots followed by a single white dot this white dot signifies an increase in volatility which basically indicates that the market is starting to break out of a squeeze or a consolidation phase this is our entry signal with an enter a short trade here set a stop loss above the most recent swing High which is this one right here for the take profit we're going to set it at 2 times the risk we let this trade run and take profit this is just one of the many strategies that you can do using the squeeze momentum indicator lazy bear the creator of this indicator even suggests using it to trade divergences which will be a story for another day that's been it for this video hope you found some value if you did hit the like button below and consider subscribing to stay tuned thanks for watching and I'll see you guys next time

Channel: PineTrades

Views: 45,914

Keywords: scalping trading strategy, forex trading, trading forex, forex, crypto trading, trading strategy, investing, day trading, swing trading, profitable trading strategy, best scalping trading strategy, forex scalping strategy, best scalping strategy forex, Profitable Buy Sell Indicator, buy sell indicator tradingview, squeeze momentum indicator lazybear, squeeze momentum indicator, hankotrade

Id: fgtfI5eAS_Y

Length: 9min 51sec (591 seconds)

Published: Sun Feb 26 2023