Commodity Channel Index (CCI)
The Commodity Channel Index (CCI) is a technical indicator used to identify cyclical trends in commodities, stocks, and other markets. It was developed by Donald Lambert in 1980 and is used to determine when a market is overbought or oversold. The CCI is calculated by taking the difference between a security’s price and its average price over a given period of time, and then dividing it by the mean absolute deviation of the security’s price over the same period. The result is then multiplied by a constant factor. The CCI is typically used to identify potential buy and sell signals in the market.
History of the Commodity Channel Index
The Commodity Channel Index was developed by Donald Lambert in 1980. Lambert was a technical analyst who wanted to create a tool to identify cyclical trends in commodities, stocks, and other markets. He developed the CCI by taking the difference between a security’s price and its average price over a given period of time, and then dividing it by the mean absolute deviation of the security’s price over the same period. The result is then multiplied by a constant factor.
The CCI is a popular technical indicator used by traders to identify potential buy and sell signals in the market. It is often used in conjunction with other indicators, such as the Relative Strength Index (RSI) and the Moving Average Convergence Divergence (MACD).
Comparison Table
| Indicator | Description |
|---|---|
| Commodity Channel Index (CCI) | Used to identify cyclical trends in commodities, stocks, and other markets. |
| Relative Strength Index (RSI) | Used to measure the speed and change of price movements. |
| Moving Average Convergence Divergence (MACD) | Used to identify potential buy and sell signals in the market. |
Summary
The Commodity Channel Index (CCI) is a technical indicator used to identify cyclical trends in commodities, stocks, and other markets. It was developed by Donald Lambert in 1980 and is used to determine when a market is overbought or oversold. The CCI is typically used in conjunction with other indicators, such as the Relative Strength Index (RSI) and the Moving Average Convergence Divergence (MACD). For more information about the Commodity Channel Index, you can visit Investopedia, TradingView, and other financial websites.
See Also
- Relative Strength Index (RSI)
- Moving Average Convergence Divergence (MACD)
- Bollinger Bands
- Stochastic Oscillator
- Average Directional Index (ADX)
- On Balance Volume (OBV)
- Parabolic SAR
- Fibonacci Retracement
- Price Channel
- Relative Vigor Index (RVI)
