New edge proposed: keltner_channel_squeeze_expansion — E8 Intelligence Research

Abstract

{ "name": "keltner_channel_squeeze_expansion", "source": "Chester Keltner / Linda Raschke (Keltner Channel squeeze breakout)", "type": "entry_engine", "rule": "Enter short when price closes below the lower Keltner Channel (20 EMA \u00b1 2.0 * ATR14) after at least 3 consecutive bars with range <= 0.7 * ATR14 (squeeze), with ATR14 of current bar > ATR14 of prior bar; stop is prior swing high, target is 1.5 * ATR14 from entry.", "pseudocode": "\nif bars_since_squeeze_start >= 3 and all_those_bars.range <= 0.7*ATR14:\n if close < lower_keltner(20, 2.0*ATR14) and ATR14_now > ATR14_prev:\n enter_short_at_close\n stop = highest(high, 10) since squeeze_start\n target = entry - 1.5*ATR14\n if target hit or stop hit: exit", "why_it_works": "Keltner squeezes indicate compressed volatility that frequently resolves into directional expansion, and a close beyond the channel with rising ATR confirms the start of that expansion." } Author: Andrew Stewart Caldin, Independent Researcher, UK. Part of the E8 Intelligence Research series. Platform: e8intelligence.com