Bears Power Stocks Technical Analysis and Bears Power Stocks Signals
Created by Alexander Elder
Bears Power is used to estimate power of the Bears (Sellers). Bears Power estimates the balance of power between the bulls & bears.
This stocks indicator aims at identifying if a bearish stocks trend will continue or if the stocks price has reached a point where it might reverse.
Calculation
A Stocks Price bar has 4 parameters: the Opening, Closing, High and Low of the stocks price bar.
Each Stocks Price bar either closes higher or lower than the previous stocks price bar.
The highest stocks price will indicate the maximum power of the Bulls within a stocks price period.
The lowest stocks price will indicate the maximum power of the Bears within a stocks price period.
This stocks technical indicator uses the Low of the stocks price and a Moving Average (Exponential)
The moving Average represents the middle ground between sellers and buyers for a certain stocks price period.
Therefore:
Bears Power = Low Stocks Price - Exponential Moving Average
Stocks Technical Analysis & How to Generate Signals
Sell Stocks Signal
A sell trading signal is generated when oscillator moves below Zero.
In a down stock trend, the LOW is lower than EMA, so the indicator is below zero & Histogram/Oscillator is located below zero line.
Exit Trading Signal
If the LOW moves above the EMA then it means that stocks price are starting to rise, the histogram rises above the zero line.
The Triple Screen method for this indicator suggests identifying the stocks price trend on a higher chart interval (like daily time frame) and applying the bears power signals on a lower chart interval (like hourly time frame). Signals are traded according to the lower time frame but only in direction of the long term stocks trend in the higher chart timeframe.
