Percent R (%R)
The Percent R indicator is also an overbought-oversold oscillator. It is efficiently used in jerky markets, it is locked in a sideways price pattern or trading range. It can also be used to show when to sell on rallies in bear markets or to purchase on bottoms in bull markets.
An overbought market is believed to happen when the Percent R line exceeds the sell zone line. On the contrary, an oversold market is believed to happen when the Percent R line is less than the buy zone line.
On the whole, this indicator can help you take advantage of shorter-term countertrend shifts which happen inside longer-term trends and demonstrate the best time to exit (enter) a definite Forex market.