Trigger Lines: Cross vs. Thrust

In this Indicator Spotlight, we’re looking at the Trigger Lines indicator which can be used as a trend filter. The Fast Trigger is a LinReg Indicator, similar to the standard NinjaTrader version. The signal line is calculated by applying an EMA to the linear regression indicator. Therefore, an identical plot can be achieved by simply applying the NinjaTrader default LinReg (80) for the fast line. By using the same LinReg (80) as input for an EMA(20), you may plot the signal line. To learn more, watch the video or continue reading below:

Trigger Lines trend definition: Cross

A basic application of the Trigger Lines indicator is to use the fast vs. slow crosses to determine trend changes. Therefore, if the fast trigger crosses the slow to the upside, it marks the beginning of an uptrend. Conversely, when the fast trigger crosses the slow to the downside, it marks the beginning of a downtrend. Other than the fast and slow moving averages, the Indicator Library version of the Trigger Lines indicator comes with additional features, including color plots, paint bars and dataseries for use in strategy scripts and Bloodhound from SharkIndicators

Trigger Lines Cross for NT8
Trigger Lines Cross

However, relying on crosses alone is not recommended for trade setups because of the significant delay vs. price action. Therefore, a second trend definition includes a comparison between price and the Trigger Lines band.

Trigger Lines trend definition: Thrust

With this definition the two Trigger Lines are considered as a band. The trend is positive when the price bars close above the band and negative when they close below the band. With this approach, possible trend changes can be recognized at an earlier stage. In addition to the close above / below the band, additional conditions apply to establish a trend change.

For establishing a new uptrend, the following requirements apply:

  • Close above the band
  • Median above the band (more than half of the candle body above the band)
  • Close of the bar above the high of the previous bar
  • Range expansion: Candle body must be larger than or the same size as the previous candle body (i.e. trend change invalidated in range contraction scenarios)
Price vs. Trigger Lines Band
Trigger Lines Thrust

In order to establish a new downtrend, the following requirements apply:

  • Close of the bar below the band
  • Median of the bar below the band (more than half of the candle body below the band)
  • Close of the bar below the low of the previous bar
  • Range expansion: Candle body must be larger than or the same size as the previous candle body (i.e. trend change invalidated in range contraction scenarios)

Comparing Cross vs. Thrust

To review which Trigger Lines indicator setting work best, i.e. cross vs. thrust, one may want to combine with a tool for entry timing. In the below chart we‘ve added the Squeeze indicator, which was featured in a previous spotlight.

Trend Bias for Squeeze Setups
Squeeze setups aligned with Trigger Lines bias

Briefly, “The Squeeze” is a frequently discussed setup that occurs in situations of consolidation or low volatility. Basically, it’s looking to determine scenarios where the market is building up momentum for its next major move higher or lower. By combining with the Trigger Lines, one may test the statistically most favorable setting for determining the trend bias. We’ll take a look at how to do that in a tutorial using Bloodhound from SharkIndicators and you can register for that in the form below.

Other Library Indicators

The Trigger Lines indicator is found in our Moving Averages category along with other indicators that may help you identify the direction and strength of a trend. These tools are typically used to determine trend bias for your entries, spot consolidations and better manage your profits. Members have access to a number of other Moving Averages, including the Exponential Hull Moving Average, Fibonacci Bands, Multiple Rainbow Filter and the Range Weighted Moving Average.

Tutorials and Templates 

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