Total Power: Counting Bullish and Bearish Price Conditions

Summary

The indicator tracks how often highs and lows meet conditions relative to an exponential moving average over a configurable lookback. It reports three values: a bullish count, a bearish count, and the absolute difference between those counts, each scaled as a percentage of the lookback period.

A bullish observation occurs when the period’s high exceeds the EMA, while a bearish observation occurs when its low falls below the EMA. The power lookback and EMA length are adjustable. The document gives the calculation rules but provides no trading signals, performance tests, or guidance for interpreting the readings. The counts can overlap when both conditions occur, and the absolute difference discards which side had the larger count, so these values alone do not establish market direction or predictive value.

Key ideas

• Bull power is the share of lookback observations whose highs exceed the EMA.
• Bear power is the share whose lows fall below the EMA.
• Total power is the absolute difference between the bullish and bearish counts, scaled by the lookback length.
• The power lookback and EMA calculation length are adjustable.
• The document does not provide performance evidence or a trading rule.

Tags

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