Chande Momentum Oscillator

Chande Momentum Oscillator Interpretation:

This indicator is similar to the RSI indicator. Buy signals occur generally when crossing the -50 level and sell signals when crossing the +50 level. Chande is always scaled between -100 and +100.

It also gives good divergence signals. A bullish divergence occurs when the stock price makes new lows while the chande fails to make new lows. A bearish divergence occurs when the stock price makes new highs while the chande fails to make new highs. We can apply a moving average on this indicator to smooth it.

Chande Momentum Oscillator Calculation:

pos positive variation, pos=0 if variation is negativeneg negative variation, neg =0 if variation is positive .variation=pos-neg

We calculate Mpos and Mneg the moving average with p days of pos and neg Chande Momentum Oscillator = (Mpos - Mneg) / (Mpos + Mneg) * 100

Return from Chande Momentum Oscillator to Using Indicator

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