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Indicators & Oscillators

4 terms


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Indicators & Oscillators

Death Cross

The crossing of a shorter moving average below a longer one, conventionally the 50-day below the 200-day.

Test: 50-period Moving Average crosses from above to below the 200-period Moving Average qualitative
Indicators & Oscillators

Directional Movement Index

A pair of lines measuring upward and downward directional movement separately, from which the ADX is derived.

+DM = Current High - Previous High when positive and larger than -DM; -DM = Previous Low - Current Low when positive and larger than +DM; each is smoothed and divided by ATR to give +DI and -DI ratio (x, times)
Indicators & Oscillators

Divergence

A condition in which price and an indicator derived from it move in opposite directions.

Test: price makes a new extreme while the indicator fails to confirm it with a corresponding new extreme qualitative
Indicators & Oscillators

Donchian Channel

Bands drawn at the highest high and lowest low of the last n periods, with a midline between them.

Upper Channel = Highest High over n periods; Lower Channel = Lowest Low over n periods; Middle = average of the two