Usually the coax indicators I’ve seen are about 12-14cm tall, and that takes up a LOT of space on my minimill.
I’m thinking about making my own, with a forked stub that goes in the mill spindle, and a rotating indicator ending in a hard steel ball, like dial indicators, but rather than spending a lot of time trying to build a clever mechanism to convert in-and-out movement of the indicator into a linear movement, I’m thinking about sticking a magnet on the indicator needle and measuring its position with a hall effect sensor, then sending the result via some wireless protocol to some sort of indicator. It could be vastly shorter this way.
Thoughts?
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As much as I love a good hack, I’d question the precision of my work if I did that. I’d go for indicol-style DTI holder instead. Either clamp or shank depending on the mill.
I have a coax indicator, and I’ve still been pondering getting one of those… For me, probably clamp so I can use it with an end mill still installed… 
Granted, a better idea, but I was kinda thinking hey if it has an electronic interface I could hook it into linuxcnc and tell it to self-center…
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Don’t want to spring for a Haimer? 
Even cheaper on their ebay store right now…
Or, getting fancier, here is a three-axis probe:
It comes in both NO and NC and has a light so you can use it manually too.
Oh and @GrblGru the seller recommends using GrblGru to use it with GRBL, though you’d enjoy seeing that.
I’ve also thought a bit about how to build a work probe and tool setter kit that can interface with LinuxCNC. To get one that is as good or better than the off-the-shelf probes and setters (in both quality and price) seems really hard but as a project it still sounds like good fun.
Given how much ferrous metal and EMI is in a mill I wonder whether a hall effect sensor would be wonky. For a coaxial indicator I’d be tempted to look into whether a few strain gauges could reliably do the work but I’m s total hack in this area so you probably shouldn’t listen to me. 
The probe I use at work does some slick math to interpolate back in time from when it receives a probe signal to when the probe was actually touched. That alone sounds like an interesting bit of work!
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I bet y’all won’t be surprised to hear that I made a touch probe. It’s only okay, but I did get it working with linuxcnc, more specifically with the homing sequence setup, so it runs until it senses a collision, then backs off very slowly until the collision clears, and registers that step as the edge. (It’s a pointer into a metal disc that’s touching three bearing balls, with a triple input AND hooked to the three bearing balls.)
But I crashed it and haven’t gotten around to fixing it yet. I wrote one routine for inside and one for outside, and then called the wrong one. sigh
An issue with almost anything premade is that my spindle taper’s MT1 and for most purposes the max cylindrical shank I can hold in the machine is 0.375". SOME day I’ll get a bigger mill and maybe make a significantly more capable spindle for this one.
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