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Momentum Indicators
Commodity Channel Index
CCI measures the current price level relative to an average price level over a given period of time. High values mean price is well above average, low values mean it is well below.
Dynamic Chart Demo
Indicator Line Price
* This chart uses synthetic data to demonstrate the indicator's behavior in typical market conditions.
Core Usage
Trend Detection: Values above +100 signal a new uptrend.
Overbought/Oversold: Readings above +200 or below -200 indicate extremes.
Divergence: Spotting potential reversals when price and CCI disagree.
Advantages
- Very responsive to price changes
- Effective for identifying cycles
- Multi-purpose
Limitations
- Can be volatile
- Generates many signals
- Requires filtering
Calculation Logic
CCI = (Typical Price - SMA) / (0.015 * Mean Deviation)
Understanding the mathematical logic behind indicators helps you interpret signals more accurately and avoid misuse in unsuitable market environments.
Common Trading Strategies
Strategy 1
Zero-Line Cross
Trading based on the CCI crossing the zero line to confirm momentum shifts.
S1
S2
S3
BUY
SELL
Signal simulation for: Zero-Line Cross
Buy
Sell
Best For
「Identifying cyclical trends.」
Note: Technical indicators are mathematical calculations based on historical price and volume. They should be used as part of a comprehensive trading system, not as a standalone entry signal.