The ROCnROLL Technical Indicator forex b
Today I thought I'd tell you about this nifty little indicator I've found hidden away in ProRealTime. I've never heard of this indicator before but on further investigation it looks quite impressive.
The imaginatively titled ROCnROLL indicator is, according to ProRealTime, based on the ROC (rate of change) and EMAs (exponential moving averages).
It takes the form of a very simple histogram and visually displays whether the currency pair (or any other financial instrument) is trending upwards, downwards or sideways. A green histogram on the ROCnROLL indicator signals a bullish trend, a red histogram signals a bearish trend and a blue histogram indicates that there is no clear trend at present.
It's a simple indicator but seems to be quite effective. For example on the daily chart of the GBP/USD the histogram was red between August 1 and 11 September when the GBP/USD fell from around 1.98 to 1.75, turned blue for a few weeks when the pair bounced back slightly indicating no real trend was present, before turning red again from September 29 up until the present day where the pair has fallen nearly 3000 points.
Like a lot of indicators the ROCnROLL indicator appears to be most effective in a trending market but it still might be worth paying attention to if you have access to ProRealTime.