Key Interpretation Methods of CCI IndicatorsHello?
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The CCI indicator, which is included in the 'Strength' indicator, now displays only the oversold or overbought zones.
Accordingly, it seems that there will be difficulties in understanding the indicators, so we took the time to give reinforcement explanations.
The CCI setting I use is 150.
Accordingly, it is utilized to see the flow of the mid-term and above.
The basic source value of CCI is (high + low + close) / 3.
Accordingly, we added the 150 SMA line and the CCI indicator as a secondary indicator.
If it rises a lot from the 150 SMA line, the CCI value rises above +100.
When it rises above +100, it is interpreted as entering the overbought zone.
Entering the overbought zone like this means that there is a possibility that it will exit the overbought zone in the near future.
However, while it is in the overbought zone, it also means that the force to rise is just as strong.
Accordingly, it is the basis for conducting transactions by identifying support and resistance points or sections.
Conversely, if the price drops a lot from the 150 SMA line, the CCI value will fall below -100.
Similarly at this time, when the CCI breaks out of the oversold zone, it enters the sideways zone, providing a basis for trading.
When the CCI is between -100 and +100, prices move sideways.
It is not easy to analyze with only the CCI indicator when it is in the sideways section with the CCI indicator.
Therefore, with the CCI indicator, it is recommended to find the basis for trading when entering and exiting the overbought section (CCI +100) and oversold section (CCI -100).
Since you can check the overbought and oversold sections of the Bollinger bands and CCI shown in this price chart, I think it is a good idea to use it together with the Bollinger bands.
It is quite difficult to create a trading strategy based solely on indicators like these.
Therefore, it is important to create a trading strategy by making sure to set support and resistance points on the price chart and see if the indicators are supported or resisted at those support and resistance points or intervals.
The setting value of Bollinger Bands used in this chart is 60.
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** All descriptions are for reference only and do not guarantee profit or loss in investment.
** Even if you know other people's know-how, it takes a considerable period of time to make it your own.
** This is a chart created with my know-how.
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