Requests and Raw Ideas

Great thanks ND.

Originally Posted by newdigital

The Commodity Channel Index (CCI) measures deviations from the moving average while showing overbought and oversold conditions
When CCI crosses up above the -100 line, a buy signal is generated
Don’t get thrown off by the lengthy name “Commodity Channel Index” as it is not a new 24-hour cable broadcast devoted to pork bellies and soybeans; though you could use it to trade either of these. CCI is a popular indicator used by Forex traders to identify oversold and over bought conditions much in the same way that RSI or Stochastics is used. But instead of 30 and 70 representing oversold and overbought areas, CCI uses -100 and +100. Though Donald Lambert created CCI back in 1980 to identify cyclical turns in commodities it is very effective with currencies. By measuring the current price relative to the average price of a set period like 14, CCI is low during time prices are below their average and high when prices are above their average. This gives us the oversold and overbought regions.

Why is this important you may ask? Well, it is simple. When we have a strong uptrend, the best place to buy is at price point where traders are no longer selling or selling pressure begins to subside. This is called being “oversold”. How do we know when something is oversold? This is a great question too! Forex traders have several tools and methods at their disposal to show them when prices have fallen too far too fast and when bargain hunters may step in sending prices higher. Candlestick pattern, oscillators and support/resistance levels are the primary tools. With CCI, Forex traders look to buy when CCI crosses above -100.

Attachment 27280

Similar to real estate investing, without the headache and a lot more fun, Forex traders want to buy the “worse house in the best neighborhood at the lowest price.” In our analogy, the best neighborhood is a strong trend; the “worse house” is the entry zone for our trade. Like the real estate investor, we look for the value of our holdings to increase over time. Since we have bought at a relatively low price, our risk is small relative to the potential gain. Unlike real estate fixer-uppers, Forex traders can forget remodeling as time and trend work to increase the value of the position

Attachment 27281

the source

The Commodity Channel Index measures the variation of a commodity price from its statistical mean/statistical average.
This indicator is an oscillator which oscillates between high levels and low levels
When the CCI is high it shows that price is unusually high compared to the its average.
When the CCI is low it shows that price is unusually low compared to the its average.

Forex Technical Analysis and Generating Forex Trading Signals

1. Overbought/ Oversold Levels
The CCI typically oscillates between ±100.
Indicator values above +100 indicate an overbought conditions and an impending market correction.
Indicator values below -100 indicate an oversold conditions and an impending market correction

1.1. Buy Signal
If the Commodity Channel Index is oversold, levels below -100, then there is a pending market correction.
The oversold levels will remain intact until CCI starts to move above -100.
When price starts moving above -100 then that is interpreted as a buy.
The Commodity Channel buy signal should be combined with a trend line break signal to confirm the buy.

1.2. Sell Signal
If the Commodity Channel Index is overbought, levels above +100, then there is a pending market correction.
The overbought levels will remain intact until CCI starts to move below +100.
When price starts moving below +100 then that is a interpreted as sell.
This Commodity Channel sell signal should be combined with a trend line break signal to confirm the sell.

2. Divergence Trading

2.1. Bullish Divergence
Bullish divergence occurs when price is making new lows while the CCI is failing to surpass its previous low.
This is a bullish signal because the divergence will be followed by an upward market correction.

2.2. Bearish Divergence
Bearish Divergence occurs when price is making new highs while the CCI is failing to surpass its previous high.
This is a bearish signal because the divergence will be followed by a downward market correction.

the source

Originally Posted by igorad

Hi The Losser,

Please check out the updated Lawgirl's Trend Display indicator which shows the candle direction for the listed symbols and timeframes.

Attachment 26772

Regards,
Igor

Hi Igorad

Can you modified the indicator into the heiken ashi candle direction?

Thanks in advance

Thanks ND for Details on CCI.

Hi Igor,

Request to check this CCI ,it is giving compilation error.

Originally Posted by jagadish123

Thanks ND for Details on CCI.

Originally Posted by jagadish123

Hi Igor,

Request to check this CCI ,it is giving compilation error.

Enjoy it! :-)

It's time to upload more CCI indi to the forums.

Dear Igor and ND,

Is it possible for you to create a bollinger band indicator based on attached indicator?
So the Bollinger will be smoothed by kalman indicator instead of SMA?Thanks

Originally Posted by Tovim

Dear Igor and ND,

Is it possible for you to create a bollinger band indicator based on attached indicator?
So the Bollinger will be smoothed by kalman indicator instead of SMA?Thanks

Hi Tovim,

Please take a look the NonLinearKalmanBBands_v1.0 600+ indicator which I posted in the John Ehlers Toolbox thread.


Regards,
Igor

Thank you Igor,

Much appreciated.