Woodies CCI Patterns

$14.97

Woodies CCI Patterns

$14.97

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Woodies CCI Patterns

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In this article we will explain several of the patterns and the logic behind them.

The first pattern of the CCI is the Zero-Line Reject, and it is a method I personally find very profitable. The logic of this pattern is that the CCI touches or comes close to the zero-line (the level 0) and immediately bounces back.- Usually it is required that price stays at least 6 bars above the zero-line (for long trades) or below the zero-line (for short trades).

The logic behind this pattern lies in the formula of the CCI: The Commodity Channel Index shows us the average distance between price and the 14-period Moving Average. Therefore, a zero-line-reject is in fact showing us that price touches the moving average and bounces in the trend-direction. You can place a moving average of typical price on the chart and see it for yourself.

That’s one of the most powerful patterns of the Woodie’s CCI, and even if you trade that pattern only – you’ll do just fine.

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