DEFINITION of 'Polarized Fractal Efficiency - PFE'

A technical indicator developed by Hans Hannula that was invented to determine price efficiency over a user-defined time period. This indicator fluctuates between -100 and +100 with 0 as the center line. Securities with a PFE greater than zero are deemed to be trending up, while a reading of less than zero indicates the trend is down.

BREAKING DOWN 'Polarized Fractal Efficiency - PFE'

The strengh of the trend is measured by the position of the PFE relative to the zero line. As a general rule, the further the PFE value is away from zero, the stronger and more efficient the given trend is. A PFE value that fluctuates around the zero line could indicate that the supply and demand for the security are in balance and price may trade sideways.

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RELATED FAQS
  1. What is the Polarized Fractal Efficiency (PFE) formula and how is it calculated?

    Take a deeper look at the calculations within the polarized fractal efficiency indicator, an oscillator that measures the ... Read Answer >>
  2. What are the best technical indicators that complement the Polarized Fractal Efficiency ...

    Learn some of the best complementary technical indicators that can be utilized in conjunction with the polarized fractal ... Read Answer >>
  3. What is a common strategy traders implement when using the Polarized Fractal Efficiency ...

    Understand the polarized fractal efficiency indicator and learn a common trading strategy that can be implemented using this ... Read Answer >>
  4. Why is the Polarized Fractal Efficiency (PFE) important for traders and analysts?

    Discover how traders and analysts use the polarized fractal efficiency indicator to show the relative efficiency of price ... Read Answer >>
  5. How do I use Polarized Fractal Efficiency (PFE) to create a forex trading strategy?

    Discover a forex trading strategy designed to profit from market reversal signals generated by the Polarized Fractal Efficiency, ... Read Answer >>
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    In technical analysis, there have been numerous indicators invented for identifying trends. One of the most common of these ... Read Answer >>
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