Differential Indicator: Comparing Accumulated Bull and Bear Price Moves

Summary

The differential indicator compares accumulated positive and negative close-price changes over a user-selected number of bars. It displays separate bull-power and bear-power lines, calculated from positive and negative increments respectively. The calculation period controls the lookback, while a separate display setting limits how many past bars appear without changing the indicator values.

The document interprets the higher line as the stronger side and treats a crossover as a possible trend change, suggesting trades in the direction of the newly dominant line. This is a simple directional signal based on recent price increments. The text provides no backtest, transaction-cost analysis, parameter selection method, or risk controls, so its crossover interpretation should be treated as a hypothesis rather than evidence of profitability.

Key ideas

• Bull and bear power sum positive and negative close-price increments over a chosen lookback.
• The indicator plots the two accumulated measures as separate lines.
• The higher line is interpreted as the currently stronger side.
• A crossover is presented as a possible trend-change signal.
• The document provides no performance tests or risk-management rules.

Tags

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