Commodity Channel Index-CCI Indicator
Fortieth session of Forex Training
Welcome back to Forex professional training in financial markets.
CCI or Commodity Channel Index
CCI, Commodity Channel Index, was first used on Commodity markets that have volatile movements and trends.
Nowadays, traders exploit this oscillator on all financial markets, especially on volatile symbols, to detect extreme regions.
CCI is based on a Momentum Oscillator.
Whenever CCI trend touches level +100, trader can place a Buy order.
Sell Extreme Condition shows a great tendency to sell which creates a good opportunity for a trader to place a Sell order.
Whenever CCI trend touches level -100, trader can place a Sell order.
Examples on USDJPY can be beneficial. Trader can insert from Trend option of Indicator menu.
CCI chart shows numerous sharp movements and trends, unlike RSI.
An example shows that as CCI trend touched level +100, market price has increased considerably.
A long candle confirmed the upward trend, too. CCI trend touched level +100 again, so that trader could place a Buy order.
Another Sell order could have been placed when CCI trend touched level -100 again.
In this example, there is a Bearish Head and Shoulders with an upward neckline.
That concludes this session, until next time and another session take care.