EFS

for Trading Success

EFS Featured Studies of the Month: The CCI and the Ease of Movement Strategies

The EFS library is full of new and useful strategies you can use for free in eSignal.
This month, we feature a study that can help you detect the beginnings and endings of market cycles using moving averages and trading ranges. We also feature a study that measures the magnitude of price and volume movement.

The Commodity Channel Index Strategy

The Commodity Channel Index (CCI) is best used with markets that display cyclical or
seasonal characteristics and is formulated to detect the beginning and ending of these
cycles by incorporating a moving average together with a divisor that reflects both possible and actual trading ranges. The final index measures the deviation from normal, which indicates major changes in market trend.

To put it simply, the CCI value shows how the instrument is trading relative to its mean (average) price. When the CCI value is high, it means that the prices are high compared to the average price; when the CCI value is down, it means that the prices are low compared to the average price. The CCI value usually does not fall outside the -300 to 300 range and, in fact, is usually in the -100 to 100 range.

Download the CCI Strategy EFS study

The Ease of Movement (EOM) Strategy

This indicator gauges the magnitude of price and volume movement. The indicator returns both positive and negative numeric values where a positive value means the market has moved up from yesterday's value and a negative value means the market has moved down. A large positive or large negative value indicates a big move in price and / or lighter volume. A small positive or small negative value indicates a small move in price and / or heavier volume.

 

Download the Ease of Movement EFS study

Resources for EFS

• To access other EFS studies, visit the EFS Library (wait a few seconds for the Most Popular Articles listing to appear).
• For detailed tutorials on EFS, including how to implement EFS studies within eSignal, visit the Help Guides and Tutorials section of the EFS KnowledgeBase.