CCI Technical Analysis and CCI Trading Signals

Developed by Donald Lambert

CCI measures the variation of a commodity price from its statistical mean(statistical average).

This indicator is an oscillator which oscillates between high levels and low levels

When the CCI is high it displays that price is unusually high when compared to its average.

When the CCI is low it displays that price is unusually low compared to its average.

Trading Technical Analysis and How to Generate Trading Signals

Overbought/ Oversold Levels

The CCI typically oscillates between ±100.

Indicator values above +100 indicate an overbought conditions & an impending market correction.

Indicator values below -100 indicate an oversold conditions & an impending market correction

Buy Trading Signal

If the Commodities Channel Index indicator is oversold, areas below -100, then there is a pending market correction.

Oversold areas will remain intact until CCI indicator starts to move above -100.

When price starts moving above -100 then that is interpreted as a buy.

The Commodity Channel buy signal should be combined with a trendline break signal to confirm the buy.

Buy Trade

Sell Silver Signal

If the CCI is over bought, areas above +100, then there is a pending market correction.

The over bought areas will remain intact until Commodities Channel Index indicator starts to move below +100.

When price starts moving below +100 then that's a interpreted as sell.

This Commodity Channel sell signal should be combined with a trendline break signal to confirm the sell.

Sell Trade

Divergence XAGUSD Trading

Bullish Silver Trade Divergence Setup

Bullish divergence occurs when price is making new lows while the CCI is failing to surpass its previous low.

This is a bullish signal because the divergence will be followed by an upward market correction.

Bearish Trade Divergence Setup

Bearish Divergence occurs when price is making new highs while the CCI is failing to surpass its previous high.

This is a bearish signal because the divergence will be followed by a downwards market correction.

Technical Analysis in Silver Trading