Bears Power XAUUSD Technical Analysis & Bears Power XAUUSD Signals

Developed by Alexander Elder

Bears Power is used to estimate the power of the Bears (Sellers). Bears Power estimates the balance of power between the bulls & bears.

This xauusd indicator aims at identifying if a bearish xauusd trend will continue or if the price has reached a point where it may reverse.

Calculation

A Price bar has four parameters: the Opening, Closing, High & Low of the price bar.

Each XAUUSD Price bar either closes higher or lower than the previous price bar.

The highest price will indicate the maximum power of the Bulls within a price period.

The lowest price will indicate the maximum power of the Bears within a price period.

This xauusd indicator uses the Low of the price & a MA (Exponential MA)

The moving Average represents the middle ground between sellers & buyers for a certain price period.

Therefore:

Bears Power = Low Price - Exponential Moving Average

Technical Analysis & Generating Signals

Sell XAUUSD Signal

A sell signal is generated when oscillator moves below Zero.

In a down xauusd trend, the LOW is lower than Exponential Moving Average, so the indicator is below zero & Oscillator is located below zero line.

Exit Signal

If the LOW moves above the EMA then it means that price are starting to rise, the histogram rises above the zero line.

The Triple Screen method for this indicator suggests identifying the price trend on a higher chart interval (like daily time frame) and applying the bears power signals on a lower chart timeframe interval (like hourly chart timeframe). Signals are traded according to the lower time frame but only in the direction of the long term xauusd trend in the higher chart time frame.