BULLS POWER AND BEARS POWER

Bulls Power and Bears Power

Bulls Power

Bulls Power is the difference between the highest value and the 13-term exponential moving average. Accordingly, it is calculated using the formula:

Bulls = high – .may
where:

Bulls – Bulls Power;

High – Highest Price;

EMA – Exponential Moving Average

When there is a growing tending in the market, then the indicator is greater than zero. When it decreases Trend, the Bulls Power Indicator is less than zero.

Related: Aroon Indicator, click here

Bears Power

The beer power indicator is the opposite of the Bulls Power Indicator. It measures the strength of the bear market. Accordingly, this value is calculated as the difference between the minimum value of the price. Expansive moving averages with 13 periods. It is calculated using the formula:

Bear = Low – EMA

where:
Bear – Bear Force;

Low – lowest price;

EMA – Exponential Moving Average

Related: Advance Decline Ratio (ADR) , click here

Then the downward trend is weak, the power of the indicative beer will be less than zero. If prices rise, then it will be even above zero lines. As a rule, these two indicators are used in combination with trend indicators (moving averages, or other). The slope of the last in this case shows the direction of prices. Care should be taken during this decision making opening and closing positions. Therefore, when the strength of the bulls shows more than zero. But at the same time decreases. Then the moving average also goes down – this is an indication for sell.

Signal peaks (deviation) Similarly, the Bears Power Indicator is used. When moving averages show the tending toward the upward trend, and the indicator is trading below zero, it is a sign of purchase. Deviation also strengthens it.

Related: Accumulative Swing Index (ASI) , click here

Buy Signal

  • Rising movement of moving average.
  • Growth indicator beers power at zero cost.
  • Deviation (deviation of maximum and minimum values of indicator and value chart)

Trade is not required to move downward speed (beer power index is less than zero) a good sign. There is a long term decline after turn-up (below zero lines).

Sell Signal

  • Decreasing movement of Moving Average.
  • Decreasing the indicator of the Bell’s power which is above zero
  • Divergence

When you open a position for sell to limit the loss. You can put stop-loss at the top of the last maximum value for money.

Related: How to Choose Stocks For Long Term Investment, click here

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