Trading Indicator Toolbox – Aroon Indicators

The last ten articles have been entitled Analysis Toolbox and we discussed the various market cycles including trends and continuations. This next part of the The Trader’s Indicator Series focuses on the Indicator Toolbox, as we will discuss various indicators that are found on most trading platforms. We will discuss the indicator in the context of the chosen market, and if it resonates with you, please continue to do your own analysis with it. Trading successfully is all about feeling comfortable with a methodology and using that system repeatedly even when boredom sets in. I will be discussing indicators in alphabetical order that can be found on the MotiveWave platform, this wek its the turn 0f the Aroon Indicators. (for a free 2-week trial CLICK HERE)

Aroon may be used to determine if an instrument is trending or not and how strong the trend is. The indicator system consists of two lines Aroon(up) and Aroon(down). Developed by Tushar Chande in 1995.

Aroon Indicators

SETTINGS

The Aroon indicators account for the # of periods (e.g. daily, 4H, 1H, 1M) since price recorded an x-period high or low. The indicators include Aroon-Up and Aroon-Down. The standard setting is 25 periods which measures the number of periods since a 25-period high in the case of a 25-period Aroon-Up. A 25-period Aroon-Down measures the number of periods since a 25-period low. Since Aroon focuses on time relative to price, it differs from standard momentum oscillators, which look at price vis-à-vis time.

Aroon IndicatorsThese indicators fluctuate between 1 to 100 percent. Aroon-Up is calculated on price highs, and Aroon-Down on price lows.

Aroon-Up = ((25 – Periods since 25-period High)/25) x 100

Aroon-Down = ((25 – Periods since 25-period Low)/25) x 100

USING THE TOOL

This content is restricted to site members. If you are an existing user, please log in. New users may register below for FREE.

Existing Users Log In
   
New User Registration
*Required field
Jody
Jody Samuels, a former institutional trader for a US Investment Bank, and author of The Trader’s Pendulum, The 10 Habits of Highly Successful Traders, founded FX Trader’s EDGE in 2006. A premiere, global online Trading and Coaching School, FX Trader’s EDGE is home to the Forex Foundation and Elliott Wave Ultimate, progressive educational training programs to assist traders of all levels in the markets. FX Trader’s EDGE offers individual and institutional clients proprietary tools, services and education to trade Forex, CFD’s and Stocks online. One-on-one coaching is also available.
Jody on FacebookJody on LinkedinJody on TwitterJody on Youtube
Jody

Jody

Jody Samuels, a former institutional trader for a US Investment Bank, and author of The Trader’s Pendulum, The 10 Habits of Highly Successful Traders, founded FX Trader’s EDGE in 2006. A premiere, global online Trading and Coaching School, FX Trader’s EDGE is home to the Forex Foundation and Elliott Wave Ultimate, progressive educational training programs to assist traders of all levels in the markets. FX Trader’s EDGE offers individual and institutional clients proprietary tools, services and education to trade Forex, CFD’s and Stocks online. One-on-one coaching is also available.

Comments are closed.

Translate »