The STP Momentum indicator identifies periods of consolidation in the market and accurately forecasts the direction of the move. It measures the relationship between two studies: Bollinger Bands and Keltner Channels. When the volatility increases, so does the distance between the bands, conversely, when the volatility declines, the distance also decreases. The indicator finds sections of the Bollinger Bands study which fall inside the Keltner Channels. When the market finishes a move, the indicator shows a darker colored bar on the histogram. You can also use it to determine bullish and bearish divergences on momentum plays.
