Tag: technical analysis indicators

Commodity Channel Index – Understanding the basics

Commodity Channel Index – Understanding the basics

Trading Indicators
Commodity Channel Index, or CCI for short is an indicator in technical analysis, used in identifying the cyclic trends in security and is commonly used to analyze commodities. It measures the currency price relative to an average price level for a given time period. Donald Lambert developed the Commodity channel index and is used as a versatile indicator to identify new trends or warn the trade of volatile trading conditions. The Commodity Channel indicator can be used not only for commodity trading but can be equally used with trading ETF's, Indices, stocks and forex markets. The way the CCI works is quite simple. The CCI reading is relatively high when prices are far above their average and is low when prices fall below their average. Thus, CCI can be efficiently used for identifying ...