Commodity Channel Index - CCI

Dictionary Says

Definition of 'Commodity Channel Index - CCI'

An oscillator used in technical analysis to help determine when an investment vehicle has been overbought and oversold.  The Commodity Channel Index, first developed by Donald Lambert, quantifies the relationship between the asset's price, a moving average (MA) of the asset's price, and normal deviations (D) from that average. It is computed with the following formula:
Commodity Channel Index (CCI)
Investopedia Says

Investopedia explains 'Commodity Channel Index - CCI'

The CCI has seen substantial growth in popularity amongst technical investors; today's traders often use the indicator to determine cyclical trends in not only commodities, but also equities and currencies.

The CCI, when used in conjunction with other oscillators, can be a valuable tool to identify potential peaks and valleys in the asset's price, and thus provide investors with reasonable evidence to estimate changes in the direction of price movement of the asset.

Sign Up For Chart Advisor!

Try Our Stock Simulator!

Test your trading skills!

Related Definitions

  1. Technical Analysis

    A method of ...
  2. Oscillator

    A technical ...
  3. Horizontal Channel

    Using trendlines ...
  4. Trend Analysis

    An aspect of ...
  5. Relative Strength Index - RSI

    A technical ...
  6. Mechanical Investing

    Buying and ...
  7. Indicator

    Statistics used ...
  8. Channel

    1. The system of ...
  9. Risk

    The chance that ...
  10. Universe Of Securities

    A set of ...

Articles Of Interest

  1. "Do The Right Thing" For Trade Breakouts

    Often in life, the right action is the hardest to take. Discover how to get on the right side of a trend.
  2. Timing Trades With The Commodity Channel Index

    We introduce how to use this oscillator, which identifies cyclical trends, for determining buy and sell points.
  3. An Introduction To Oscillators

    Find out how this indicator may help improve the average investor's entry and exit points.
  4. Channeling: Charting A Path To Success

    Find out how to build these charts showing buy, sell, stop-loss and take-profit points, and even estimate length of trade.
  5. Anticipate Trends To Find Profits

    Monitoring your trades in real-time can help you anticipate their outcomes.
  6. Tips For Controlling Investment Losses

    A profit/loss plan helps investors recognize mistakes and invest logically, rather than emotionally.
  7. Triple Screen Trading System - Part 4

    How can a trader use the Elder-Ray oscillator as the second screen of this system? Find out here.
  8. Triple Screen Trading System - Part 3

    Learn about market wave, the second screen in this three-part system.
  9. Triple Screen Trading System - Part 2

    Market tide is the basis for making trading decisions in this three-part system.
  10. Triple Screen Trading System - Part 1

    Learn to take advantage of both trend-following and oscillator techniques to analyze your trading decisions.

comments powered by Disqus
Recommended
Loading, please wait...
Trading Center