A technical oscillator developed by Tom DeMark to determine overbought and oversold conditions for the currency pair under study. A reading above 0.7 is considered overbought and a bearish reversal may be imminent. A reading below 0.3 is considered oversold and a bullish reversal may be in the making.
If High(i) > High(i-1) then DeMax(i) = High(i) – High(i-1) else DeMax(i) = 0
If Low(i) < Low(i-1) then DeMin(i) = Low(i) – Low(i-1) else DeMin = 0
DeMarker(i) = SMA(DeMax, N)/(SMA(DeMax, N)+SMA(DeMin, N))« Back to Glossary Index