Tom Demarker created the DeM in an attempt to measure the demand for the underlying currency pair. The DeM indicator relates recent price action to recently closed prices.
Traders use the index to determine overbought and oversold conditions, assess risk levels, and time when price exhaustion is imminent. Values exceeding either boundary are deemed more risky, while values within are considered low risk.
Overbought and oversold conditions are imminent when the curve crosses over these boundary lines, respectively. The DeM indicator is common on Metatrader4 trading software, and the calculation formula sequence involves these straightforward steps:. Software programs perform the necessary computational work and produce a DeM indicator as displayed in the bottom portion of the following chart:.
The DeM indicator is composed of a single fluctuating curve. Traders will occasionally add an exponential moving average, as above in red, to enhance the value of the trading signals.
DeMarker Indicator — MahiFX
The DeMarker indicator tends to pick major bottoms better than tops. A shorter period setting will create a more sensitive indicator, but will also increase choppiness and the potential for increased false signals. The next article in this series on the DeMarker indicator will discuss how this oscillator is used in forex trading and how to read the various graphical signals that are generated.
Trading Foreign Exchange on margin carries a high level of risk and may not be suitable for all investors.
The possibility exists that you could lose more than your initial deposit. The high degree of leverage can work against you as well as for you.
DeMarker - Oscillators - Technical Indicators - Price Charts, Technical and Fundamental Analysis - MetaTrader 5 Help
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World's best forex deals and strategy. DeMarker Indicator Explained — What is the DeMarker Indicator? DeMarker Formula The DeM indicator is common on Metatrader4 trading software, and the calculation formula sequence involves these straightforward steps: Software programs perform the necessary computational work and produce a DeM indicator as displayed in the bottom portion of the following chart: Sign Up Free Demo.