Two-group exponential average compression as a trend filter

A multiple-moving-average stack is a single overlay of many exponential averages arranged in two lookback groups. Compression, expansion, and group alignment are read as market-state information rather than as a single numeric threshold.

The short-horizon average group is the faster cluster. It is used to show near-term agreement on value and the first visual tightening. The long-horizon average group is the slower cluster. It is used to confirm broader direction and to reject setups that tighten in only the short group.

Two gapped exponential groups

Exponential averages are chosen because recent observations receive more weight. That exponential weighting changes how longer lookbacks behave around turning points.

The short-horizon average group is built from 3-, 5-, 8-, 10-, 12- and 15-day exponential averages, spaced around half-weekly sampling steps. The long-horizon average group starts by doubling the last short lookback to 30 days, then adds 35-, 40-, 45-, 50- and 60-day exponential averages.

The construction leaves a lookback gap of unused intermediate lookbacks between the two groups so constriction and crossing remain easier to see.

Compression as collapsing agreement

On the illustrated daily series, averages from widely different lookbacks often converge in a short window just before and during major turns instead of crossing in a long staggered lag.

That interval is a compression window: a short span in which several averages from one or both groups narrow together. It is treated as collapsing agreement on value rather than a single price print.

A usable warning is defined as simultaneous narrowing across both groups. That dual-group convergence is treated as a stronger warning than compression confined to one group. Tightening in only one group is treated as temporary short-horizon weakness.

When a group crossover is read

A crossover is read as momentary agreement on value across time frames, not only as a possible change in price direction. That second reading is valuation agreement: two or more lookbacks momentarily price the same series similarly.

After both bands narrow, the operational cue is to follow the direction of the group crossover while the long-horizon averages confirm the prevailing trend. The group crossover is the directional crossing of the short group through the long group. It is used as the long or short cue only after compression has already formed.

Short-group expansion, or a later tightening of the fastest two or three averages, is treated as an exit cue rather than as a new stand-alone entry rule.

A confirmatory trend filter

The stack is used as a confirmatory trend filter after other price or indicator screens. It is not framed as an initiating formula or a single numeric threshold.

In that role, the long-horizon average group is the trend filter. It keeps candidates aligned with the broader average stack and discards those that fail the dual-group test.