First, the principle of CCI index
Aldbert) in 1980 is a quantitative technical index, which can be used to analyze the phenomenon of overbought and oversold in the market, thus helping investors to better grasp investment opportunities.
The calculation formula of CCI index is as follows:
CCI=(TP-MA)÷MD÷0.0 15
Daily simple moving standard deviation.
Through calculation, CCI index can divide the fluctuation range of the market into three States: normal range, overbought and oversold range and extreme range, thus helping investors to better analyze the market conditions.
Second, the application of CCI indicators
1, overbought and oversold warning
When CCI index exceeds the normal range (+100), it indicates that the market is overbought, and investors should be cautious to avoid losses. When the CCI index is lower than the normal range (-100), it indicates that the market is oversold and investors can consider buying.
2. buying and selling signals
When the CCI index falls below the overbought range (+100), it indicates that the market is overbought and investors can consider selling. When the CCI index breaks through the oversold range (-200) from the normal range (-100), it shows that the market has oversold and rebounded, and investors can consider buying.
3. Trend judgment
When CCI index crosses the overbought range (+100), it indicates that the market is on the rise and investors can consider buying. When the CCI index falls below the normal range (-100) and crosses the oversold range (-200), it indicates that the market has a downward trend and investors can consider selling.
Third, the advantages and disadvantages of CCI indicators
CCI index has the advantages of simple calculation, quick response and easy operation, but it also has some shortcomings. For example, it can only reflect the phenomenon of overbought and oversold in the market, but not the trend change of the market. Therefore, investors should combine other technical indicators when using CCI index to better analyze the market situation.
Fourth, the actual operation of CCI indicators
1, set CCI index.
Before using CCI indicators, investors need to set CCI indicators first. Generally speaking, investors can set CCI index to 14 days, which can better reflect the overbought and oversold phenomenon in the market.
2. Analyze CCI indicators.
When analyzing CCI indicators, investors need to pay attention to the changing trend of CCI indicators. When the CCI index exceeds the overbought range (+100), it indicates that the market is on the rise and investors can consider buying. When the CCI index falls below the normal range (-100) and crosses the oversold range (-200), it indicates that the market has a downward trend and investors can consider selling.
Verb (abbreviation of verb) abstract
CCI index is a quantitative technical index, which can help investors to better analyze the market situation, so as to better grasp the investment opportunities. It has the advantages of simple calculation, quick response and easy operation, but it also has some shortcomings. For example, it can only reflect the phenomenon of overbought and oversold in the market, but not the trend change of the market. Therefore, when investors use CCI indicators, they should combine other technical indicators to better analyze the market situation.