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William Percent R Stock Indices Technical Analysis and William Percent R Stock Indices Signals

Williams %R Technical Stock Indices Indicator Developed by Larry Williams


Williams %R indicator is pronounced as Williams percent R indicator. Williams %R Technical Stock Index Indicator is a momentum oscillator used to analyze overbought and oversold levels in the stock index trading markets.


The Williams % Range oscillator is similar to the Stochastic Oscillator indicator, apart from that fact that the %R is drawn upside down on a negative scale that is from 0 to -100 and the indicator does not apply a smoothing factor.

Williams %R, Percent R Technical Stock Indices Indicator

Williams %R, Percent R Technical Stock Index Indicator - Stock Indices Indicators


The Williams %R indicator analyzes the association of the closing stock indices prices relative to the High and Low range over a selected number of n candlesticks.



  • The closer the closing stock index price of a candlestick is to the highest high of the range selected the closer to zero the %R reading will be.

  • The closer the closing stock index price of a candlestick is to the lowest low of the range selected the closer to -100 the %R reading will be.


When doing technical analysis a stock indices trader should ignore the minus sign placed before the value, for example -40, the - sign should be ignored, just remember the indictor values are placed in an upside down manner.



  • At zero: If the closing stock index price of the candlestick is equal to the highest high of the range the William %R reading will be 0.

  • At -100: if the closing stock index price of the candlestick is equal to the lowest low of the range the William %R reading will be -100.


William Percent R Technical Stock Indices Indicator


Overbought/Oversold Levels


  • Overbought- Williams %R values from 0 to -20 are considered overbought while

  • Oversold- Williams %R values from -80 to -100 are considered oversold.


As for trading overbought/oversold levels it is best to wait for a stock indices instrument to change direction before taking a signal in the opposite direction. For Example if a stock indices instrument is oversold it is best to wait for the stock indices trend to reverse and start to head in an upward direction before buying the stock indices.


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Stock Indices Trading Trend Reversal Stock Indices Signals

The William %R indicator used to predict a stock indices trend reversal stock indices signal when trading a stock indices. The Williams %R indicator always predict a reversal using the following method


Bearish Reversal Stock Indices Signal- William Percent Range indicator forms a peak and turns down a few days before the stock index price stock indices trend peaks and turns down. The example illustrated below shows %R giving a reversal stock indices signal before stock index price starts to head down and change to a down stock index trend.

Bearish Reversal Stock Indices Signal

Bearish Reversal Stock Indices Signal after Stock Indices Trading Uptrend



Bullish Reversal Stock Indices Signal- William Percent Range indicator forms a trough and turns up a few days before the stock index price stock indices trend bottoms and turns up.

Bullish Reversal Stock Indices Signal

Bullish Reversal Stock Indices Signal after Stock Indices Trading Downtrend

 

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