DEFINITION of 'ElderRay Index'
A technical indicator developed by Alexander Elder that measures the amount of buying and selling pressure in the market. This indicator consists of two separate indicators known as "bull power" and "bear power". These figures allow a trader to determine the position of the price relative to a certain exponential moving average (EMA).
Bull Power = Daily High  nperiod EMA
Bear Power = Daily Low  nperiod EMA
BREAKING DOWN 'ElderRay Index'
Technical traders will use the values of the bull and bear power along with divergence to make transaction decisions. Long positions are taken when the bear power has a value below zero but is increasing and the bull power's latest peak is higher than it was previously. A short position is taken when the bullpower value is positive but falling and the bear power's recent low is lower than any other previous bottom. The slope of the EMA can also be used in both cases to help confirm the direction of the trend.

Exponential Moving Average  EMA
A type of moving average that is similar to a simple moving average, ... 
Purchasing Power Loss/Gain
An increase or decrease in how much consumers can buy with a ... 
Bull Position
A long position in a financial security, such as a stock in the ... 
Bull Market
A financial market of a group of securities in which prices are ... 
Purchasing Power
The value of a currency expressed in terms of the amount of goods ... 
True Strength Index  TSI
A technical momentum indicator that helps traders determine overbought ...

Active Trading
The ElderRay Indicator: Seeing Into The Market
Elderray helps determine the strength of competing groups of bulls and bears so you know when to buy and when to short. 
Active Trading Fundamentals
Triple Screen Trading System  Part 4
How can a trader use the ElderRay oscillator as the second screen of this system? Find out here. 
Technical Indicators
This Indicator Should Always Be Part Of Your Strategy
The relationship between price, 200day EMA and its slope of generate useful patterns that assist in price prediction and trade management. 
Active Trading
Discovering The Force Index
Learn how to measure the power of bulls behind rallies and bears behind declines. 
Term
What Is Purchasing Power?
Purchasing power expresses moneyâ€™s value by defining the amount of goods or services it can buy. 
Active Trading
Using The Force Index For Short and MediumTerm Trading
Here are the guidelines for making trading decisions using the force index in both a short and intermediate perspective. 
Forex Education
Simple Vs. Exponential Moving Averages
These technical indicators help investors to visualize trends by smoothing out price movements. 
Professionals
Powers Of Appointment
Powers Of Appointment 
Active Trading Fundamentals
Digging Deeper Into Bull And Bear Markets
Discover why it's important to know the characteristics of the two types of market conditions. 
Trading Strategies
Adapt The 50Day EMA To Enhance Your Trading
The 50day EMA has numerous applications in price prediction, position choice & strategy building

What is a common strategy traders implement when using the ElderRay Index?
Read about the important buying and selling conditions that are recommended by Dr. Alexander Elder when using his ElderRay ... Read Answer >> 
Why is the ElderRay Index important for traders and analysts?
Learn about the ElderRay index, a novel technical oscillator created by Dr. Alexander Elder to assess the buying and selling ... Read Answer >> 
How do I use ElderRay Index for creating a forex trading strategy?
Utilize the ElderRay index to create a forex trading strategy that can be used at potential market turning points where ... Read Answer >> 
What are the best technical indicators to complement the Exponential Moving Average ...
Utilize additional technical indicators to complement and improve a basic trading strategy that relies on exponential moving ... Read Answer >> 
How do I use Exponential Moving Average (EMA) to create a forex trading strategy?
Use the exponential moving average (EMA) to create a dynamic forex trading strategy. Learn how EMAs can be utilized very ... Read Answer >> 
What are the main differences between Moving Average Convergence Divergence (MACD) ...
Understand the exponential moving average, or EMA, and the moving average convergence divergence, or MACD, and their respective ... Read Answer >>