Woodies CCI is a Commodity Channel Index based system developed by Ken Woods. The main principle of this system is that the price moves in the direction of CCI.
Woodies CCI comprises multiple plots: CCI, TCCI, CCIHist, and several constant ones.
Zero line is the main indicator of support/resistance. If CCI crosses this level and does not go back for at least six bars, it might indicate trend existence; CCI crossing above zero line signifies the uptrend, if it crosses below, downtrend. Zero line is also merged with LSMA indicator which shows if the price is below or above LSMA (a moving average designed for Woodies CCI). Red areas of the indicator signify that the price is below LSMA; green areas, above.
CCI Hist represents CCI values in histogram format: red columns for downtrend, green columns for uptrend; gray/yellow columns mean that the trend has not established yet (six consequent bars above or below the zero line are needed). When trend is developing, CCIHist applies the colors to columns using the following algorithm: four bars after zero crossover are gray (early development), fifth is yellow (warning that trend might emerge), and starting from the sixth, columns are red or green, based on trend direction.
TCCI abbreviation stands for "Turbo CCI". It uses calculation period shorter than CCI itself, thus it is used for pattern detection and exit points, not trend analysis.
Additional trend indicators complement the system: Sidewinder and Chop Zone. Sidewinder is plotted on the "+200" and "-200" levels; its values are also shown in the chart label. Sidewinder takes into account relationship between EMA and LSMA of price; when it turns green, price is trending (chart label state "Trending"), yellow means that trend is developing (chart label state "Normal"), and red indicates that trend is absent (chart label state "Flat").
Chop Zone is plotted on the "+100" and "-100" levels. It visualizes difference between Close price and its EMA by converting its values to colors:
- Yellow. Absolute value of the difference is less than or equal to ticksize value (TS).
- Lime. The difference is in the (TS; 2*TS] range.
- Light Green. The difference is in the (2*TS; 3*TS] range.
- Dark Green. The difference is in the (3*TS; 4*TS] range.
- Cyan. The difference is greater than 4*TS.
- Light Orange. The difference is in the (-2*TS; -TS] range.
- Dark Orange. The difference is in the (-3*TS; -2*TS] range.
- Light Red. The difference is in the (-4*TS; -3*TS] range.
- Dark Red. The difference is lower than -4*TS.
||The number of bars used in TCCI calculation.|
||The number of bars used in CCI calculation.|
||The least value for which Sidewinder indicates developing trend (label "Normal").|
||The least value for which Sidewinder indicates trending conditions (label "Trending").|
||Defines whether or not to display Sidewinder indicator.|
||The Commodity Channel Index plot.|
||The Turbo CCI plot.|
||The CCIHist plot.|
||The +100 level complemented with Chop Zone indicator.|
||The -100 level complemented with Chop Zone indicator.|
||The +200 level complemented with Sidewinder indicator.|
||The -200 level complemented with Sidewinder indicator.|
||The zero level complemented with LSMA indicator.|
*For illustrative purposes only. Not a recommendation of a specific security or investment strategy.