CCI Divergence Indices Indicator

CCI indicator is one of the commonly used divergence trading indicator. This indicator is an oscillator similar to the RSI and it can be used to trade divergence setups just the same way as the RSI indicator.

CCI Indices Technical Analysis and CCI Indices Trading Signals

The CCI measures the variation of a commodity stock indexes price from its statistical mean/statistical average.

CCI indicator is an oscillator which oscillates between high levels and low levels

When the CCI is high it shows that stock indexes price is unusually high compared to the its average.

When the CCI is low it shows that stock indexes price is unusually low compared to the its average.

CCI Divergence Indices Indicator

CCI Divergence Indices Indicator

CCI Bullish Divergence Setups

Classic CCI Bullish Divergence

CCI classic bullish divergence occurs when stock indexes price is making lower lows (LL), but the CCI is making higher lows (HL).

CCI Divergence Indices Indicator

CCI classic bullish divergence warns of a possible change in the indices trend from down to up. This is because even though the stock indexes price went lower the volume of sellers that pushed the stock indexes price lower was less as illustrated by the CCI indicator. This indicates underlying weakness of the downward trend.

Hidden CCI Bullish Divergence

Forms when stock indexes price is making a higher low (HL), but the CCI is showing a lower low (LL).

CCI hidden bullish divergence occurs when there is a retracement in an upward indices trend.

Indices Trading Hidden Bullish Divergence

This setup confirms that a retracement move is complete. This CCI divergence setup indicates underlying strength of an upward indices trend.

Bearish Divergence

Hidden CCI Bearish Divergence

Forms when stock indexes price is making a lower high (LH), but the oscillator is showing a higher high (HH).

Hidden bearish divergence occurs when there is a retracement in a downward indices trend.

Indices Trading Hidden Bearish Divergence - CCI Divergence Indices Indicator

This setup confirms that a retracement move is complete. This divergence indicates underlying strength of a downward indices trend.

CCI Classic bearish divergence

CCI classic bearish divergence occurs when stock indexes price is making a higher high (HH), but the CCI is lower high (LH).

Indices Trading Classic Bearish Divergence - CCI Divergence Indices Indicator

CCI Classic bearish divergence warns of a possible change in the indices trend from up to down. This is because even though the stock indexes price went higher the volume of buyers that pushed the stock indexes price higher was less as illustrated by the CCI indicator. This indicates underlying weakness of the upward trend.