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DeMarker (DeM)
DeMarker Indicator demonstrates phases of price depletion, which usually correspond to price highs and bottoms fluctuates from 0 up to 1. The turn of the prices downwards is expected if the parameter of the indicator moves above a mark 0.7. The turn of the prices upwards is expected if the indicator moves below a mark 0.3.
That is why the DeMarker indicator searches for the phases of price exhaustion, which as a rule corresponds to the prices' highs and bottoms. The DeMarker fluctuates between 0 and 1 point. If the indicator moves over 0.7, the price turn downward is predicted. If the indicator is under the 0.3 level, the price turn upward is predicted.
Parameters:
1. N - the period of averaging.
Calculation:
Value of DeMarker indicator in an interval j is calculated as follows:
1. DeMaxj calculation.
If Highj> Highj-1, DeMaxj = Highj - Highj-1, differently DeMaxj = 0
2. DeMinj calculation.
If Lowj < Lowj-1, DeMinj = Lowj-1 - Lowj, differently DeMinj = 0
3. DeMarker indicator calculates as follows:
The DeMarker indicator compares the period maximum with the previous period maximum, which is summed up in the end. The indicator of Demark is used to search the regions with high and low risk for selling or purchasing. It registers the areas of price depletion, which correspond to price highs and bottoms. The DeMarker indicator fluctuates from 0 up to 1. If the indicator falls below 0.3, they predict the turn of the prices upwards. If the indicator goes over 0.7 level, they predict the turn of the prices downwards.