The Frontiers Of Trading

by: Ivan Cavric The DeMarker Indicator, also known as the DeM, is a technical analysis tool that compares the current price action of a financial instrument with its price action over a specified time period. It was developed by Tom DeMark, a market technician and founder of Market Studies, LLC. The DeM is used to identify potential market tops and bottoms, as well as potential trend reversals. The DeM is calculated using the following formula: DeM = (Hn - Ln) / (Hp - Lp) where Hn is the current period's highest price, Ln is the current period's lowest price, Hp is the previous period's highest price, and Lp is the previous period's lowest price. The DeM oscillates between 0 and 1, with readings above 0.7 indicating overbought conditions and readings below 0.3 indicating oversold conditions. A reading above 0.7 is generally considered a sell signal, while a reading below 0.3 is generally considered a buy signal. One of the main advantages of the DeM is that it is a lea...

By:  Ivan Cavric The  DeMarker Indicator (DI)   can be used to help you identify new trading opportunities because Tom DeMarker designed the DI with this purpose specifically in mind. The DI exhibits a number of features that have similarities to those of the indicators designed by Welles Wilder . In addition, DeMarker tried to devise solutions for those problems experienced by many other technical indications when dealing with overbought and oversold trading conditions. The DI was designed to monitor and track the market sentiment of an underlying asset by comparing its current value to that of the preceding time-period. Consequently, you can utilize the DI to evaluate the demand for a particular asset. This action will then aid you in detecting market tops and bottoms. You will discover that this indicator is particularly helpful in identifying new trading opportunities because it does not filter its raw data. The DI has two variations although both have been constructe...