Commodity Channel Index (CCI)
Commodity Channel Index (CCI) is an HTS indicator used to identify new trends or extreme trading conditions. Commodity Channel Index (CCI) works by measuring the current price level which relative to the average price over a user determined period of time.
The formula for Commodity Channel Index (CCI) is the following:
Constant = .015 Typical Price (TP) = (High + Low + Close)/3 CCI = (Typical Price - 20-period SMA of TP) / (Constant x Mean Deviation)
- Exchange Website to monitor
- Currency Pair to monitor for trade signals
- Update Speed
- Trade Signals
- Number of candles (or time periods) before an action is taken.
- Buy Threshold
- When the calculation result is equal or below this value, the indicator will generate a buy signal.
- Sell Threshold
- When the calculation result is equal or above this value, the indicator will generate a sell signal.
Commodity Channel Index is a great indicator to use when paired with another indicator as it will generally identify the current trend and/or trend reversal. It can also be used on its own, but the critical variable with this indicator is the data length. The higher the data length, the less trade signals will be provided and vice versa.