I just found out right now about an indicator called “Rate of Change” or ROC for short.
Found it while searching info about momentum on investopedia.
Price Rate Of Change (ROC) Definition | Investopedia
The normal time frame for ROC measurement is 10 days. The ratio to build the ROC indicator is as follows:
Rate of Change = 100 (Y/Yx)
“Y” represents the most recent closing price, and Yx represents the closing price a specific number of days ago. So, if the price of a stock closes higher today than it did 10 days ago, the ROC value point will be above the equilibrium, thus indicating to chartists that prices are rising in that particular issue. Conversely, if the price in today’s session closes lower than it did 10 trading days ago, the value point will be below the equilibrium, indicating that prices are falling off. It is safe to say that if the ROC is rising, it gives a short-term bullish signal, and a bearish sign would have the ROC falling. Chartists pay great attention to the time period in the calculation of ROC. Long-term views of the market or a specific sector or stock will use perhaps a 26- to 52-week time period for Yx and a shorter view would use 10 days to around six months.
I’m a bit sad that it’s not in the babypips school… This seems to be the perfect indicator for me… It can spot both divergence and momentum REALLY GOOD… It doesn’t seem to lag as much as macd, stoch and MA. I could be wrong on that though but it just seems that way from seeing some graphs of the ROC in action.
I just wanted to mention it here since it’s not in babypips school and hoping to get even more info on it… I like reading up on everything I am planning to use in my trading from many different sources even if I am reading something I already know… Might always be able to pick up something extra useful from someone else perspective and experience.
but I don’t want to sound ****y. Using that strategy, I don’t need any indicators. I only need to know how to do some basic easy math before entering a trade. The direction isn’t all that hard to figure out. It’s knowing if that direction is safe enough to enter for the time frame I trade. All I need is fluctuation. Nothing fancy, just need the price to move. Problem with indicator is they catch the movement to late in my opinion. But then again I don’t do long term trades… To risky. I don’t even have to set up a stop because i already have manual stop