Description
The Weekly and Daily PPO is a study developed by Vitaly Apirine for analysis of the Percentage Price Oscillator (PPO) using two time frames on a single chart. The technical indicator comprises two PPO lines (daily and weekly), a relative daily PPO (the sum of the daily and the weekly PPOs), and the zero level. By default, the daily PPO plot is hidden; to make it visible, click on the DailyPPO tab of the Plots area and activate the Show plot checkbox. Note: in order to match the daily and the weekly time frames, all the numbers mentioned in this article are selected for usage with an aggregation period of 1 day.
The Weekly and Daily PPO resembles closely another indicator by the same author, the Weekly and Daily MACD, and uses the same default parameter values: 12-day and 26-day EMAs for the daily line; 60-day and 130-day EMAs for the weekly line. The PPO itself is calculated as the percentage ratio of the MACD to the slowest average. Note, however, that the slowest average here is selected from all of the averages used in the calculation, which means that the percent ratio is calculated relative to the slow weekly (130-day) EMA for both the weekly PPO and the daily PPO. The relative daily PPO is calculated as the sum of the daily PPO and the weekly PPO. Being a percentage version of the MACD, the PPO can be used for comparing the behavior of different securities or analyzing the behavior of a single security over an extended period of time.
Potential trading signals may be found at crossovers of the relative daily PPO line with either of the other PPO lines or crossovers of the PPO lines with the zero level. Looking for divergences of the daily, weekly, or relative PPO from the price plot may also prove useful.
Input Parameters
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Parameter |
Description |
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Defines the period of the faster EMA for the weekly PPO calculation. |
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Defines the period of the slower EMA for the weekly PPO calculation. |
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Defines the period of the faster EMA for the daily PPO calculation. |
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Defines the period of the slower EMA for the daily PPO calculation. |
Plots
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Plot |
Description |
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The weekly PPO plot. |
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The daily PPO plot. |
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The sum of the weekly PPO and the daily PPO. |
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The zero level. |
Further Reading
1. "Weekly & Daily Percentage Price Oscillator" by Vitali Apirine. Technical Analysis of Stocks & Commodities, February 2018.
Example*
*For illustrative purposes only. Not a recommendation of a specific security or investment strategy.