Indicator Types Explained
QuantJuice provides a comprehensive suite of technical indicators tailored to different trading styles and preferences.
Momentum Indicators
These measure the speed and magnitude of price changes, helping identify overbought or oversold conditions:
- RSI (Relative Strength Index): Ranges from 0 to 100, values above 70 typically signal overbought, while below 30 indicate oversold.
- MACD (Moving Average Convergence Divergence): Tracks momentum by comparing short and long-term moving averages; bullish/bearish crossovers signal potential trend changes.
Volume Indicators
Volume shows the strength behind price movements. Key indicators include:
- On-Balance Volume (OBV): Measures buying and selling pressure by cumulatively adding/subtracting volume based on price direction.
- Volume Surge: Detects unusual volume spikes that may precede significant price moves.
Trend Indicators
Identify the general direction and potential reversal points of the market:
- Moving Averages: Smooth out price data to highlight trend direction; common types include SMA and EMA.
- Bollinger Bands: Use standard deviations from a moving average to create bands indicating volatility and potential reversal zones.
Noiseless Indicators — Filtering Market Noise
Market noise refers to random price fluctuations that obscure true trends. Noiseless indicators aim to minimize this “static” for clearer trading signals.
- Custom Smoothing Algorithms: QuantJuice incorporates advanced filters like exponential smoothing and Savitzky-Golay to reduce random spikes without losing signal integrity.
- Adaptive Thresholds: Dynamic adjustment of sensitivity based on volatility levels to avoid false signals during choppy markets.
- Signal Confirmation: Combining noiseless indicators with volume and trend filters for higher confidence entries.
By focusing on noiseless indicators, traders can reduce whipsaws and better capture meaningful price moves with less stress.
How to Interpret These Indicators
- RSI above 70: Usually indicates overbought conditions; consider tightening stops or preparing to take profits.
- MACD crossing above its signal line: Potential start of a bullish trend.
- High volume accompanying price rise: Strong buying interest that confirms momentum.
- Price crossing above moving average: Can indicate trend reversal or continuation.
- Noiseless indicator confirmation: When noiseless signals align with traditional indicators, it improves trade reliability.