CCI Commodities Analysis & CCI Trading Signals

Developed by Donald Lambert

The CCI measures the variation of a commodities price from its statistical mean(statistical average).

This indicator is an oscillator which oscillates between high levels & low levels

When the CCI is high it portrays that commodities price is unusually high when compared to its average.

When the CCI is low it portrays that commodities price is unusually low compared to its average.

Commodities Analysis & Generating Trade Signals

Overbought/ Oversold Levels

The CCI typically oscillates between ±100.

Indicator values above +100 indicate an overbought conditions & an impending market correction.

Indicator values below -100 indicate an oversold conditions & an impending market correction

Buy Trading Signal

If the CCI technical indicator is oversold, areas below -100, then there's a pending market correction.

The oversold areas will remain intact until CCI indicator starts to move above -100.

When price starts moving above -100 then that's interpreted as a buy.

The Commodity Channel buy trading signal should be combined with a trend line break signal to confirm the buy.

Buy Trade

Sell Trading Signal

If the CCI is over bought, levels above +100, then there's a pending market correction.

Over bought levels will remain intact until Commodities Channel Index indicator starts to move below +100.

When price starts moving below +100 then that is a interpreted as sell.

This Commodity Channel sell trading signal should be combined with a trend line break signal to confirm the sell.

Sell Trade

Divergence Commodities

Bullish Commodity Trade Divergence Setup

Bullish divergence occurs when price is making new lows while the CCI is failing to surpass its previous low.

This is a bullish signal because the divergence will be followed by an upwards market correction.

Bearish Trade Divergence Setup

Bearish Divergence occurs when price is making new highs while the CCI is failing to surpass its previous high.

This is a bearish signal because the divergence will be followed by a down-wards market correction.

Technical Analysis in Commodity Trading