Commodity Channel Index

[larrybf]

Aprofitable trader who I know uses the commodity channel index and claims that unlike other indicators, the CCI is a "leading indicator". I cannot find anything anywhere to support this claim. Can someone clear up this confusion for me?? thanks

 

[Magna]

Here's a brief explanation of the index from the Metastock site:

http://www.equis.com/free/taaz/cci.html

P.S. It's not a leading indicator....sorry.

 

[bungrider]

Isn't it just basically the relationship of the current price to an average price - over/undersold?

 

[larrybf]

thanks for the answers

 

[daniel_m]

Originally posted by larrybf
Aprofitable trader who I know uses the commodity channel index and claims that unlike other indicators, the CCI is a "leading indicator". I cannot find anything anywhere to support this claim. Can someone clear up this confusion for me?? thanks

I've tried many ways of looking at and using CCI. I agree with your friend, it is a leading indicator. It leads one to making some very questionable trades.

 

[aura0663]

This is an indicator that I first became aware of in '99 thru the Pristine swing trade orientation for traders (seems like a lifetime away) that they used on a 5 day short term calculation. Combined with a positive/negative futures move, short term pullback/retracement against a rising/falling trend, hopefully to a moving average or an important level of S/R, and a number piercing +100 or -100 for a short / long this was purported to be a leading indicator and a low risk play. I still maintain the CCI on my daily chart and pay attention to it, however I consider it somewhat in the same realm as the rest of the indicators(Stoc,Macd,etc), which is simply a mathematical consideration to take into account. with the main focus on playing the market for whatever it gives you.