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CCI Technical Analysis and Commodity Channel Index Signals

Created by Donald Lambert

The Commodity Channel Index measures the variation of a commodity price from its statistical mean(statistical average).

This indicator is an oscillator technical indicator which oscillates between high levels and low levels

When the Commodity Channel Index is high it highlights that price is unusually high when compared to its average.

When the CCI is low it highlights that price is unusually low compared to its average.

Commodity Channel Index Technical Indicator Analysis - How Do I Use CCI Indicator in Chart?

Gold Technical Analysis & Generating Signals

Over-bought/ Oversold Levels

The CCI typically oscillates between ±100.

Indicator values above +100 indicate an overbought conditions and an impending market correction.

Indicator values below -100 indicate an oversold conditions & an impending market correction

Buy Trade Signal

If the Commodities Channel Index indicator is over-sold, levels below -100, then there is a pending market correction.

Over-sold levels will remain intact until Commodity Channel Index indicator starts to move above -100.

When price begins moving above -100 then that is interpreted as buy.

The Commodity Channel buy signal should be combined with a trendline break signal to confirm the buy.

CCI Indicator Example Explained - CCI Indicator Technical Analysis - Indicator Analysis

Buy Trade

Sell Trading Signal

If the CCI is over-bought, levels above +100, then there is a pending market correction.

Over-bought levels will remain intact until Commodity Channel Index indicator starts to move below +100.

When price begins moving below +100 then that is a interpreted as sell.

This Commodity Channel sell signal should be combined with a trendline break signal to confirm the sell.

How Do I Place Gold CCI Indicator in Chart on Software?

Sell Trade

Divergence XAUUSD

Bullish Divergence Setup

Bullish divergence forms when price is making new lows while the CCI technical indicator is failing to surpass its previous low.

This is a bullish signal because the divergence will be followed by an upward market correction.

CCI Indicator - How to Use Trading CCI Indicator in Chart

Bearish Divergence Setup

Bearish Divergence forms when the price is making new highs while the CCI trading indicator is failing to surpass its previous high.

This is a bearish signal because the divergence will be followed by a downwards market correction.

Bearish Divergence Trading Setup Signal - CCI, CCI Indicator Technical Analysis - How to Place CCI Indicator in Chart

Technical Analysis in Gold

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