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Introduction to Technical Indicators

This article breaks down the basics of technical indicators and highlights the types of indicators available on TabTrader.

Accelerator Decelerator Oscillator

The Accelerator Decelerator Oscillator (ADO) measures acceleration and deceleration of current momentum. This indicator tends to change direction before any changes in momentum, which in turn will change direction before price.

Aroon

The Aroon indicator is used to identify trend changes in the price of an asset, along with the strength of that trend. This indicator essentially measures the time between highs and lows over a given period.

Aroon Oscillator

The Aroon Oscillator is a trend-following indicator based on the Aroon Indicator that measures the strength of the current trend and probability of continuation. Aroon Up and Down lines measure the number of periods since the last 25-period high and low.

Average Directional Movement Index

The Average Directional Movement Index (ADX) technical indicator helps to determine the strength of a price trend.

Average True Range

The Average True Range (ATR) is technical indicator that tracks market volatility.

Awesome Oscillator

The Awesome Oscillator (AO) is an indicator used to measure market momentum. AO basically determines whether the current trend is bullish or bearish, or whether a trader should expect a possible reversal.

Bollinger Bands

Bollinger Bands are a technical analysis tool consisting of a set of trendlines with two standard deviations, positive and negative, plotted around a simple moving average (SMA) of an asset's price

Chaikin Money Flow

Chaikin Money Flow (CMF) is a volume-weighted average of accumulation and distribution over a set period of time.

Commodity Channel Index

The Commodity Channel Index (CCI) is a tool used to analyze whether an asset is overbought or oversold. It measures the difference between the current price and the historical average price.

Directional Movement Index

The Directional Movement Index (DMI) is a tool used to identify asset price trends. This indicator can help traders know whether price action is flatter or more volatile.

Elliott Wave Oscillator

The Elliott Wave Oscillator (EWO), also known as the 5/35 oscillator, is basically the 35-period simple moving average (slow SMA) subtracted from the 5-period one (fast SMA).

Exponential Moving Average

An Exponential Moving Average (EMA) is a type of moving average (MA) that places greater weight and significance on the most recent data points. EMA reacts more significantly to recent price changes than a simple moving average (SMA), which applies equal weight to all observations in the period.

Fisher Transform

Fisher Transform (FT) is a technical indicator that converts price to normal (also known as Gaussian) distribution and signals when price action moves significantly by referencing recent price data.

Hull Moving Average

The Hull Moving Average (HMA) is a highly responsive and exceptionally fast-moving average that almost eliminates lag while enhancing data smoothing. It emphasizes recent prices over older ones, resulting in a fast-acting yet smooth moving average that can be used to identify the prevailing market trend.

Ichimoku Cloud

The Ichimoku Cloud is a collection of technical indicators that show support and resistance levels as well as momentum and trend direction.

Intraday Momentum Index

The Intraday Momentum Index (IMI) is a technical indicator that combines aspects of candlestick analysis with the relative strength index (RSI) in order to generate overbought or oversold signals.

Keltner Channels

Keltner Channels (KC) are volatility-based bands that are placed on either side of an asset's price and can aid in determining the direction of a trend. It uses the average true range (ATR) for volatility, with breaks above or below the top and bottom barriers signaling continuation.

Median Price

The Median Price indicator is a measure of central tendency and displays a chart of median prices representing the midpoint between the high and low price of each period.

Money Flow Index

The Money Flow Index (MFI) is a technical oscillator that uses price and volume data for identifying overbought or oversold signals. It can also be used to spot divergences which warn of a trend change. The oscillator moves between 0 and 100.

Moving Average Convergence Divergence

Moving Average Convergence/ Divergence (MACD) is a trend-based momentum indicator that shows the relationship between two moving averages of an asset’s price.

On-Balance Volume

On-balance Volume (OBV) is a trading momentum indicator that uses volume flow to predict changes in price. OBV shows crowd sentiment that can predict a bullish or bearish outcome.

Parabolic SAR

The Parabolic SAR is a technical indicator used to determine the price direction of an asset, as well as draw attention to when the price direction is changing. It is sometimes known as the "stop and reversal system”.

Relative Strength Index

The Relative Strength Index (RSI) is a momentum indicator used in technical analysis that measures the magnitude of recent price changes to evaluate overbought or oversold conditions in the price of a stock or other asset.

Simple Moving Average

A Simple Moving Average (SMA) calculates the average of a selected range of prices, usually closing prices, using the number of periods in that range.

Smoothed Moving Average

The Smoothed Moving Average (SMMA) is similar to the Simple Moving Average (SMA) in that it aims to reduce noise rather than reduce lag in asset price data.

Stochastic Oscillator

A Stochastic Oscillator is a momentum indicator comparing a particular closing price of an asset to a range of its prices over a certain period of time.

Stochastic RSI

SRSI (Relative strength, Momentum) is a tool to measure RSI relative to its own high/ low range over a user-defined period of time.

Trading Volume

Trading Volume is a technical indicator which represents the overall activity of an asset or a market. The volume indicator is used to measure the total amount of a given financial asset that has been traded in a specific period of time.

Volume Adjusted Moving Average

Volume Adjusted Moving Average (VAMA) is a technical indicator that combines price and volume when computing the average.

Volume Weighted Average Price

Volume-Weighted Average Price (VWAP) is a trading indicator used by traders that gives the average price an asset has traded at throughout the day, based on both volume and price.

Volume Delta

Volume Delta represents the difference between the pressure exerted by buyers and sellers in the market. It is calculated by subtracting the volume traded at the bid price from the volume traded at the ask price.

Cumulative Volume Delta

Cumulative Volume Delta represents the aggregated Volume Delta over a defined time period.

Volume + Volume Delta

Volume + Volume Delta is a tool combining the overall trading volume and Volume Delta indicator.