Aroon Indicator Trading Strategy — What Is It? (Backtest And Example)

Market indicators are an integral component of technical analysis. They help traders in making market decisions. Some indicators are designed to show the direction of a trend while others simply tell when a trend reversal is imminent. In this article, we look at one of the many trading indicators: the Aroon indicator. The Aroon indicator…

On-Balance Volume — What Is It? (Backtest And Trading Strategy)

Technical indicators offer powerful insights into what is happening in the market. While price is a factor in technical analysis, volume is as important as price as this tells traders the level of activity on a given security. The on-balance volume is one of the most popular volume indicators. Let’s find out what it is….

Williams Volatility Channel — What Is It? (Trading Strategy)

It seems that traders are becoming increasingly interested in the classical methods of technical analysis, and the use of trading channels have become popular again in the 21st century. Since Williams Volatility Channel is getting very popular among traders, you may be wondering what it is. Williams Volatility Channel is a trend-following indicator developed by…

NAAIM Exposure Index (Backtest Trading Strategy)

The NAAIM Exposure Index is becoming a popular indicator for tracking investor sentiment. But what is it about? Compiled by the National Association of Active Investment Managers (NAAIM), the NAAIM Exposure Index represents the average exposure to US Equity markets reported by its members. The indicator line is a two-week moving average of the NAAIM…

What Is The Put Call Ratio? Does It Work? (Backtest And Strategy)

The Put-Call ratio is a popular sentiment indicator. Extreme readings, mostly signaling panic and climax, are often used as contrarian signals to fade the market. For example, a high put reading might signal that traders and investors are panicking and are buying downside insurance (put options act as insurance) and that a market bottom is…

AAII And Market Sentiment Indicators – How To Trade It (Examples And Backtests)

Can you make money on a bullish or bearish AAII market sentiment indicator? When the pessimists turn optimistic and the optimists turn pessimistic a bottom or top is formed. If you understand market sentiment and where traders and investors feel the most pain or euphoria, you have gained a wealth of knowledge about potential turning…

Is High Short Interest Good Or Bad? How Is Short Interest Used In Trading?

Is high short interest good or bad? Short interest in trading has been a hot topic during 2021 after Gamestop made short-sellers run for cover at prices many times higher than their entry price. But was the short squeeze in Gamestop an outlier? Which stocks perform better – stocks with high or low short interest?…

Zweig Breadth Thrust Indicator – How To Measure Market Breadth

Zweig Breadth Thrust Indicator is a market breadth indicator that helps you understand the internal strength of the market, at least that’s what the theory says. There are many breadth indicators – among them the Zweig Breadth Thrust Indicator (one of many). The best way to measure market breadth is by looking at the number…

Ultimate Oscillator Indicator Trading Strategy (Backtest)

Many momentum oscillators tend to turn very positive at the beginning of a major advance and quickly enter the overbought territory or even show bearish divergence while the market is still advancing. The ultimate oscillator attempts to correct that. Let’s find out what this oscillator is made of. The ultimate oscillator (UO) is a momentum…

Oscillating Indicators – Which Is The Best For Trading Strategies?

Which oscillating indicator is the best for trading strategies? When you start out in trading it might be a daunting task to understand all the bells and whistles provided by your trading software. There are plenty of indicators, moving averages, and oscillators to use. How can you use the indicators to make money? In this…

Cutler’s RSI — What Is It? (Trading Strategy and Indicator Backtest)

Cutler’s RSI including backtest The RSI is a very popular trading indicator among different security traders. But there are other variations of the RSI indicator. One of them is Cutler‘s RSI. You may be wondering what it is, and in this article, we provide you with a description and how it performs in backtests. Cutler’s…

Connors RSI — What Is It? (Trading Strategy and Indicator Backtest)

Connors RSI including backtest The traditional RSI indicator has been a great tool for technical analysis and trading, but there have been some efforts by traders to improve on it. One of such improvements gave rise to the Connors RSI, which can be an invaluable tool for traders when applied correctly — not only does…

Investors Intelligence Sentiment Index (Contrarian Sentiment Indicator)

The Investors Intelligence Index is becoming widely accepted as a means of estimating the balance between the bulls and bears. But what does it actually mean? Also known as the Advisor Sentiment, Investors Intelligence Sentiment Index is based on contrarian propositions, which suggest equity traders should act opposite to the balance of expert opinion and…

Hindenburg Omen Indicator: How to use it? – Backtest, Formula and What Is It?

Hindenburg Omen Indicator: how do you use it and what is it? Stock market crashes can wipe out traders’ and investors’ profits or even put them at a huge loss in no time. If you have been in the market long enough, you will know that stock market downturns always happen faster than the preceding…

Zig Zag Indicator Trading Strategy — What Is It? (Backtest And Example)

There are many technical indicators out there that are not frequently used in everyday trading but can be useful for analyzing previous price actions to easily spot useful patterns and trends. One of such tools is the Zig Zag indicator. The Zig Zag indicator is a basic tool that analysts use to analyze the price…

Chaikin Oscillator Trading Strategy – Does It Work? (Backtest of the Chaikin Indicator)

The Chaikin Oscillator Indicator was developed by Marc Chaikin in the 1980s. It’s not widely used nor well-known, perhaps for good reasons: we didn’t manage to find any significant profitable Chaikin Oscillator Trading Strategy in any of the quantified tests we did. In this article, we briefly explain what the indicator is, how it’s calculated, and…

Average True Range Trading Strategy (ATR Indicator and System – How To Use It))

The ATR indicator is useful on its own and can be used to develop an Average True Range trading strategy. The Average True Range (ATR) was developed by Welles Wilder in the 1970s. In his famous book called New Concepts in Technical Trading Systems, published in 1978, Wilder also published the RSI and the ADX…

Stochastic Trading Strategies – Indicator and System – Does It Work? (Explained)

The stochastic indicator is a standard indicator in any trading platform, but we rarely see it published or used in any Stochastic trading strategies. Compared to the RSI, stochastics seems much less popular. Is that because it’s less useful or is this a hidden gem? The stochastic indicator does work in a stochastic trading strategy….

Williams %R Trading Strategy – Williams Percent Range vs RSI (Indicator & Systems)

Williams %R was developed by the famous trader and tax rebellion Larry Williams, who has given names to several technical indicators. Last week we wrote about the WilliamsVixFix indicator, and today we are explaining the Williams %R and how to calculate and use the indicator. Williams %R does work. In this article, we explain how…

WilliamsVixFix Explained – Does It Work? (Including trading strategies)

WilliamsVixFix indicator was invented back in 2007 when the well-known trader and “indicator innovator” Larry Williams wrote an article in Active Trader about VIX and how you can create your synthetic VIX for any security you like. The aim of Williams was to create a “synthetic” VIX reading for other instruments than the S&P 500,…

ADX Indicator Backtest (Trading Strategies That Work And The Best Settings)

Is it possible to use the ADX indicator to find a profitable ADX trading strategy? This article looks at the ADX indicator where we make some historical backtest to evaluate and analyze. The adx indicator was developed by Welles Wilder and released in his book in 1978 called New Concepts In Technical Trading Systems. Mr….

RSI Trading Strategies (Backtest) – How The RSI Indicator Works

This article looks at how the RSI indicator works and how you can develop an RSI trading strategy. The Relative Strength Index (RSI) was developed by Welles Wilder and first introduced in a magazine called Commodities (now Futures) in June 1978. Wilder published a book in the same year called New Concepts In Technical Trading…

The Elder Ray Indicator (With Strategies): Does It Work?

In a series of articles, we want to test different indicators and trading techniques. Almost all indicators are “proved” by anecdotal evidence, and rarely quantified. That’s perhaps not a coincidence: Most of them are useless and do not have any predictive value. We backtest some Elder Ray strategies and Our aim is to figure out…

The Internal Bar Strength (IBS) Indicator [Including Quantified Strategies]

The Internal Bar Strength indicator (IBS) has worked remarkably well for over two decades. We can only guess why, but the stock market has been highly mean-reverting during this period, and this has of course given the IBS a nice tailwind. IBS is simply an indicator where you buy on weakness and sell on strength,…