Bulls Power Gold Trading Analysis and Bulls Power Trading Signals

Created by Alexander Elder

Bulls Power is used to estimate power of the Bulls (Buyers). Bulls Power estimates the balance of power between the bulls & bears.

This gold indicator aims at identifying if a bullish gold trend will continue or if the xauusd price has reached a point where it might reverse.

Calculation

A Gold Price bar has 4 parameters: the Opening, Closing, High and Low of the xauusd price bar.

Each Gold Price bar either closes higher or lower than the previous xauusd price bar.

The highest xauusd price will show the maximum power of the Bulls within a xauusd price period.

The lowest xauusd price will show the maximum power of the Bears within a xauusd price period.

This Indicator uses the High of the xauusd price and a Moving Average (Exponential)

The moving Average represents the middle ground between sellers & buyers for a certain xauusd price period.

Therefore:

Bulls Power = High Gold Price - Exponential Moving Average

Bulls Power

Gold Analysis and Generating Trading Signals

Buy Gold Signal

A buy trading signal is generated when Bulls Power oscillator moves above Zero.

In an up gold trend, the HIGH is higher than Exponential Moving Average, so the Bulls Power is above zero and Histogram/Oscillator is located above zero line.

Exit Trading Signal

If the HIGH falls under Exponential Moving Average then it means that xauusd price are starting to fall, the Bulls Power histogram fall below the zero line.

The Triple Screen technique for this indicator suggests identifying the xauusd price trend on a higher chart interval (like daily time frame) and applying the bulls power on a lower chart interval (like hourly time frame). Signals are traded according to the indicator but only in the direction of the long term gold trend in the higher time frame.