CCI Average: Difference between revisions
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Commodity Channel Index Average, along with [[Comm Channel Index|Commodity Channel Index]], is commonly used for determining cycle beginning and ending in futures markets. This indicator may also help to identify buy and sell opportunities. | |||
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CCI takes a security's change in price and compares that to its average change in price. CCI's calculation produces positive and negative values that oscillate above and below a Zero Line. Typically a value of 100 is identified as overbought and a reading of -100 is identified as being oversold. However, it is important to note a couple of things. Actual overbought and oversold thresholds can vary depending on the financial instrument being traded. For example, a more volatile instrument may have thresholds at 200 and -200. Frequently, overbought/oversold conditions are seen as a precursor to a price reversal. However, when using CCI, overbought and oversold conditions can often be a sign of strength, meaning the current trend may be strengthening and continuing. When applied to a chart, this indicator contains three plots, displayed in a separate subgraph from the price data. | |||
== Default Inputs == | |||
'''CCILength (14)''' - number of bars used for CCI calculation.<br> | |||
'''CCIAvgLength (9)''' - number of bars used for calculation of the CCI average.<br> | |||
'''OverSold (-100)''' - value used to identify oversold market. <br> | |||
'''OverBought (100)''' - value used to identify overbought market. | |||
== Plots == | |||
'''Plot1 (CCI, Yellow)''' - CCI line.<br> | |||
'''Plot2 (CCIAvg, Red)''' - average of the CCI. <br> | |||
'''Plot3 (OverBot, Dark Green)''' - overbought level reference line. <br> | |||
'''Plot4 (OverSld, Dark Green)''' - oversold level reference line. | |||
<div style="background-color: #E3FBE5;">'''Note''': All the plots will be displayed in a separate sub chart from the price data when the indicator is applied to a chart. </div> | |||
[[Category:Pre-built Indicators]] |