Monday, June 8, 2009
Williams Percent R
If you are into trading using Overbought and Oversold Prices, the Williams Percent R indicator might be the thing for you. This indicator is very effective in determining whether a price is overbought or oversold when trading Forex. You see, at a glance, it looks like the RSI and it works like the Stochastic Oscillator.
It is easy to explain how the Williams Percent R works. It is just the opposite of the Stochastic Oscillator. When the price is oversold, the Williams Percent R value will be at the bottom, around -80 to -100. When it is overbought, the value will be 0 to -20.
And this indicator, unlike Stochastic, has no smoothing. So it will be in jagged-lined format, like RSI. To use the RSI in trading, I will often wait till there is a change in RSI sloping direction. If it is going down but then it suddenly slopes up a bit, there might be a trend reversal.