Woodies CCI Arrows Oscillator Indicator
Platform: MT4 Type: Momentum Last update: September 28, 2024The Woodies CCI Arrows Oscillator Indicator is a forex momentum tool that was originally developed by Ken Woods. As the name suggests, it’s based on a Commodity Channel Index (CCI) with a period set to 14. Due to its complexity, this gauge has multiple applications. One can utilize strategies like trading with the trend or against it, zero line rejection, reverse divergence, or the trendline break.
How to use the woodies cci arrows oscillator?
The Woodies CCI Arrows Oscillator Indicator can be considered as a standalone and complete trading tool. It incorporates several elements including CCI, TurboCCI, Buy/Sell Arrows, EMA, LSMA, Histogram Bars. Upper and lower extreme gray zones are respectively overbought levels (value of 200 or more) and oversold levels (value of -200 or less). As you can see, the fact of having so many signals, it is rather a trading tool for advanced traders. Here are some (not all of them) signals provided by the Woodies CCI indicator.
Zero-line reject
During a strong trend in a particular direction, the CCI bounces off in an opposite direction and gets close to the zero-line. It is usually a signal of a trend reversal. but in this case, traders should make an entry based on the original trend direction.
Reverse divergence
Whenever there are peaks and troughs on the CCI making a straight line when connected and the straight line also points to zero, it is signal of a strong trend in the direction of the straight line.
Horizontal trendline
When the CCI forms two peaks or troughs exactly on the same level it is a signal of potential new trade. When the horizontal trendline can be spotted above 0 level, you should be looking for a sell trade. Similarly, when it occurs below 0 level, you should be looking for a buy trade.
