Indicators & Oscillators — 60 Terms Defined

Keltner Channel Indicators & Oscillators ₹ Bands plotted a multiple of average true range above and below an exponential moving average of price. Middle Line = 20-period EMA; Upper Channel = Middle + 2 x ATR; Lower Channel = Middle - 2 x ATR

Lagging Indicator Indicators & Oscillators qualitative An indicator that confirms a move after it is under way, typically built by smoothing price over a lookback window. Test: the indicator averages or smooths past values, so its turning point necessarily follows price's own

Leading Indicator Indicators & Oscillators qualitative An indicator claimed to change before price does, usually built from the rate of change rather than the level of price. Test: the indicator's construction emphasises the most recent periods so that it turns before a smoothed measure would

Lookback Period Indicators & Oscillators days The number of past periods an indicator examines when computing its current value. Test: the indicator's value at time t depends on data from t - n + 1 through t, and on nothing earlier

MACD Indicators & Oscillators ₹ The moving average convergence divergence indicator: the difference between a fast and a slow exponential moving average of price. MACD Line = 12-period EMA - 26-period EMA; Signal Line = 9-period EMA of the MACD Line

MACD Histogram Indicators & Oscillators ₹ The difference between the MACD line and its signal line, plotted as bars around a zero axis. Histogram = MACD Line - Signal Line

Market Breadth Indicators & Oscillators % The extent to which a market's move is shared across its constituents rather than concentrated in a few. Measures include advance-decline ratio, percentage of securities above their 200-day moving average, and new highs minus new lows

Momentum Indicator Indicators & Oscillators ₹ An indicator measuring the speed of price change rather than its level or direction. Momentum = Current Close - Close n periods ago

Money Flow Index Indicators & Oscillators ratio (x, times) An oscillator bounded 0 to 100 that applies the RSI calculation to price multiplied by volume rather than to price alone. MFI = 100 - 100 / (1 + Money Flow Ratio), where the ratio is Positive Money Flow / Negative Money Flow over n periods and Money Flow = Typical Price x Volume

Moving Average Indicators & Oscillators ₹ The average price over a fixed number of recent periods, recalculated as each new period is added. Moving Average = Sum of the last n Closing Prices / n

Moving Average Crossover Indicators & Oscillators qualitative The point at which a shorter moving average crosses above or below a longer one. Test: Short-Period Moving Average crosses through Long-Period Moving Average, in either direction

On-Balance Volume Indicators & Oscillators shares A running total that adds a period's volume when the close rises and subtracts it when the close falls. OBV = Previous OBV + Volume if Close > Previous Close; - Volume if Close < Previous Close; unchanged if equal

Oscillator Indicators & Oscillators qualitative An indicator that moves within a bounded range, used to describe the pace of price change rather than its direction. Test: the indicator's output is confined between fixed limits, such as 0 to 100 or -100 to +100

Overbought Indicators & Oscillators qualitative A description of an oscillator reading above a conventional upper threshold, such as RSI above 70. Test: oscillator value exceeds its conventional upper threshold, typically 70 for RSI or 80 for stochastics

Oversold Indicators & Oscillators qualitative A description of an oscillator reading below a conventional lower threshold, such as RSI below 30. Test: oscillator value falls below its conventional lower threshold, typically 30 for RSI or 20 for stochastics

Parabolic SAR Indicators & Oscillators ₹ A trailing stop-and-reverse indicator that plots dots which accelerate toward price as a move extends. SAR = Prior SAR + Acceleration Factor x (Extreme Point - Prior SAR), with the factor rising by a step each time a new extreme is made

Price Oscillator Indicators & Oscillators % The difference between two moving averages of price, expressed either in absolute terms or as a percentage. Percentage Price Oscillator = (Short-Period MA - Long-Period MA) / Long-Period MA x 100

Put-Call Ratio Indicators & Oscillators ratio (x, times) The ratio of put option activity to call option activity, measured by volume or by open interest. Put-Call Ratio = Put Volume / Call Volume, or Put Open Interest / Call Open Interest

Rate of Change Indicators & Oscillators % The percentage change in price over a fixed number of periods. ROC = (Current Close - Close n periods ago) / Close n periods ago x 100

Relative Strength Indicators & Oscillators % The performance of one security measured against another security or an index over the same period. Relative Strength = Security Price / Benchmark Price, tracked over time; or Security Return - Benchmark Return

Relative Strength Index Indicators & Oscillators ratio (x, times) An oscillator bounded between 0 and 100 that compares the average size of recent gains with the average size of recent losses. RSI = 100 - 100 / (1 + RS), where RS = Average Gain over n periods / Average Loss over n periods

Signal Line Indicators & Oscillators qualitative A moving average of an indicator's own values, plotted alongside it to mark where the indicator turns relative to its own trend. Signal Line = Moving Average of the Indicator's values over a stated period

Simple Moving Average Indicators & Oscillators ₹ A moving average that weights every period in the window equally. SMA = (P1 + P2 + ... + Pn) / n

Smoothing Period Indicators & Oscillators days The number of periods an indicator averages over, controlling how much noise it removes and how much it lags. Test: increasing the smoothing period reduces the variance of the indicator's output and increases its lag