JohnHosana Momentum/Breakout Indicator

The Johnhosana Momentum/Breakout Indicator is a pure trend-following indicator. It only looks at price data, and doesn't guess where support and resistance areas are. That sounds a bit basic but it's actually a great strength. Since the Johnhosana Momentum/Breakout Indicator follows the trend, it practically guarantees that we're on the right side of important trends.

When prices cross the upper band, open a long position. Sell when they cross the opposite band.
When prices cross the lower band, initiate a short trade. Cover that position once prices cross the other band.

A nice feature of the Johnhosana Momentum/Breakout is that it moves with prices. When there's an uptrend, new highs push the upper band higher. But an uptrend also has higher lows, and that makes the Johnhosana Momentum/Breakout lower band also move up. This way our long exit becomes more favourable the longer the trend continues.

The size of the Johnhosana Momentum/Breakout also tells us something. When the market is in a volatile downtrend, the Johnhosana Momentum/Breakout increases in height. Then when price volatility decreases, the channel becomes smaller as well. (And when the bands become exceptionally narrow, there's even a chance of a volatile breakout.)

The Johnhosana Momentum/Breakout is not always easy to trade, unfortunately. When prices move sideways, the indicator can generate a lot of false signals. And when trends don't last long, there isn't always enough price movement for a profitable exit. In those environments we better use oscillators instead of trend-following indicators.