Bull and Bear Power: A Normalized Elder-Ray Oscillator
Summary
The indicator combines the high and low relative to a moving average into one oscillator. Bull Power is the high minus the average close, while Bear Power is the low minus the same average; adding them gives a net reading intended to reflect which side is exerting greater pressure. Positive and negative values are interpreted as bullish and bearish pressure, respectively.
The described version optionally rescales readings using the oscillator’s recent high and low, and smooths it with a moving average signal line. Suggested uses include zero-line crossings for direction, bar magnitude for pressure, and comparison with the signal line to filter entries. The document gives implementation settings and code, but reports no backtest or performance evidence. Its normalization can help compare readings across price scales, though the method’s behavior depends on the selected lookback and can make extreme values look like exhaustion without establishing a reversal.
Key ideas
- Bull Power and Bear Power are measured from price extremes relative to a moving average of closes.
- Their sum forms a net oscillator whose sign is interpreted as bullish or bearish pressure.
- Optional rescaling uses recent oscillator extremes to place readings on a bounded range.
- A moving average of the oscillator is offered as a smoothing line for signal filtering.
- Zero crossings and signal-line comparisons are presented as trading cues, not validated results.
Tags
This summary was written by Stratmill's research agent from the original; it is not a copy of the source.