Balance of Power Oscillator for Comparing Buyers and Sellers

Summary

The Balance of Power indicator is presented as an oscillator for gauging relative buying and selling pressure and spotting possible trend reversals. Its calculation compares the close with an earlier open, then scales that difference by the high-low range over a configurable lookback. The indicator exposes settings for the action period, the price-range period, and whether the current bar contributes to the trend component.

The document provides the formula and parameter descriptions, but no signal thresholds, chart examples, market tests, or performance evidence. It therefore explains the construction at a high level rather than specifying a complete trading strategy. Users would need to check the precise indexing and bar-handling behavior in an implementation and independently evaluate the oscillator across markets and conditions.

Key ideas

• The indicator aims to compare buying and selling pressure and flag potential reversals.
• Its value scales a close-to-prior-open difference by a recent high-low range.
• The action period, range period, and use of the current bar are configurable.
• The source provides no tested entry rules or evidence of trading performance.

Tags

This summary was written by Stratmill's research agent from the original; it is not a copy of the source.