The Average Directional Index (ADX) is a technical indicator developed by J. Welles
Wilder Jr. in 1978. It is designed to measure the strength of a trend, with high
values indicating a strong trend and low values indicating a weak trend. The ADX is
calculated using a combination of three other indicators: the Plus Directional
Indicator (+DI), the Minus Directional Indicator (-DI), and the Average True Range
(ATR). The +DI and -DI are used to measure the strength of a trend in one direction,
while the ATR is used to measure the overall volatility of the market. The ADX is
typically plotted alongside the +DI and -DI on a chart, with a separate line
representing the ADX itself. It has become a widely used indicator in the field of
technical analysis and is often used to help traders identify potential trend changes
and make informed trading decisions.
The Aroon indicator was developed by Tushar Chande in 1995 as a way to measure the
strength of a trend and identify potential trend changes. The indicator consists of
two lines, the Aroon Up and the Aroon Down, which oscillate between 0 and 100. The
Aroon Up measures the number of periods since the highest high in the given time
period, while the Aroon Down measures the number of periods since the lowest low. A
high value for the Aroon Up indicates that an uptrend is present, while a high value
for the Aroon Down indicates a downtrend. A crossover of the two lines can signal a
potential trend change. The Aroon indicator is often used in conjunction with other
technical analysis tools to confirm trend strength and potential reversals.
The Average True Range (ATR) indicator was developed by J. Welles Wilder Jr., a
technical analyst and commodity trader, in the late 1970s. It was introduced in his
1978 book "New Concepts in Technical Trading Systems." The ATR is a technical
indicator that measures the volatility of a financial instrument, such as a stock or
currency pair. It is calculated by taking the average of the true ranges of a given
number of periods, typically 14 periods. The true range is the greatest of three
values: the current high minus the current low, the absolute value of the current high
minus the previous close, and the absolute value of the current low minus the previous
close. Wilder believed that the ATR could be used to set stop-loss orders and to
identify trend breakouts. It is widely used by traders and investors to assess market
risk and to make informed decisions about their trades.
The Bollinger Bands indicator was developed by John Bollinger in the 1980s. It is a
technical analysis tool that uses a moving average as the center line and plots upper
and lower bands around it based on standard deviation. The purpose of the indicator is
to provide a relative definition of high and low prices of a security and to help
identify when prices are overbought or oversold. The bands widen when prices are
volatile and contract when they are stable. Bollinger Bands are often used in
conjunction with other indicators to confirm trading signals.
The Ichimoku Cloud indicator, also known as the Ichimoku Kinko Hyo, is a technical
analysis tool developed by Goichi Hosoda, a Japanese journalist, in the late 1930s. It
was first published in his book, "Ichimoku Sanjin", which was released in 1968. The
indicator is designed to provide a comprehensive view of the market, including trend
direction, momentum, and support and resistance levels. It consists of five lines,
which are plotted on a chart: the Tenkan-sen, Kijun-sen, Senkou Span A, Senkou Span B,
and Chikou Span. These lines are used to identify the trend, measure momentum, and
identify potential areas of support and resistance. The indicator is popular among
traders and analysts in Japan and has gained widespread adoption in other countries as
well.
The MACD (Moving Average Convergence Divergence) indicator was developed by technical
analyst Gerald Appel in the 1970s as a way to analyze stock prices. It is a
trend-following momentum indicator that compares the difference between two moving
averages of a security's price. The MACD is calculated by subtracting the 26-day
exponential moving average (EMA) from the 12-day EMA. A nine-day EMA of the MACD,
called the "signal line," is then plotted on top of the MACD to act as a trigger for
buy and sell signals. The MACD is widely used by technical analysts and traders to
identify trend changes, gauge the strength of a trend, and spot potential trade entry
and exit points.
Moving averages have been used as a momentum indicator for many years. They were first
introduced by Dow Theory pioneer Charles Dow in the late 1800s, who used simple moving
averages to smooth out price data and identify trends. The moving average was later
refined by financial analysts such as William Peter Hamilton and Robert Rhea, who
developed more complex versions of the indicator such as the exponential moving
average (EMA) and the weighted moving average (WMA). Moving averages have since become
a popular tool among technical analysts and traders, who use them to identify trends,
support and resistance levels, and potential entry and exit points in the market.
Today, moving averages are widely used in a variety of financial markets, including
stocks, commodities, and currencies, and are available in many charting software
packages and trading platforms.
Jackrabbit TV's Momentum detection is based upon moving averages
The PSaR (Parabolic SaR) indicator was developed by Welles Wilder Jr. and first
introduced in his 1978 book, "New Concepts in Technical Trading Systems." It is a
trend-following indicator that is used to identify the potential reversal of an
asset's price direction. The indicator is plotted as a series of dots above or below
the price on a chart, with the dots changing position based on the asset's price
action. If the dots are below the price, it indicates an uptrend, while if the dots
are above the price, it indicates a downtrend. The indicator is based on the idea that
as an asset's price trends higher or lower, the dots will gradually move in the
opposite direction, eventually signaling a potential reversal. It is commonly used in
conjunction with other indicators to confirm trend changes and to help traders make
informed decisions about when to enter or exit a trade.
The Relative Strength Index (RSI) is a technical analysis indicator developed by J.
Welles Wilder Jr. in 1978. It is a momentum oscillator that measures the speed and
change of price movements, and is used to identify overbought and oversold conditions
in a market. The RSI is calculated using a formula that compares the magnitude of
recent gains to recent losses, and is plotted on a scale from 0 to 100. A reading
above 70 is considered overbought, while a reading below 30 is considered oversold.
Wilder originally introduced the RSI in his book "New Concepts in Technical Trading
Systems," and it has since become a widely popular indicator among traders and
investors.
The stochastic indicator is a technical analysis tool that was developed by George
Lane in the 1950s. It is designed to help traders identify overbought and oversold
conditions in the market by comparing the closing price of a security to its price
range over a set period of time. The indicator is based on the idea that prices tend
to close near the high or low of the range during strong trends, and near the middle
of the range during ranging or consolidating periods. The indicator is typically
displayed as two lines on a chart, with one line representing the fast stochastic and
the other representing the slow stochastic. The lines oscillate between 0 and 100,
with readings above 80 indicating overbought conditions and readings below 20
indicating oversold conditions. The stochastic indicator is commonly used in
conjunction with other technical analysis tools to confirm trade signals and help
traders make more informed decisions.
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