ROC

Rate of Change

Very similar to Momentum. The Rate of Change measures the percentage change between the current price and the price a set number of periods ago (the period can be changed under "edit").

Can be thought of as the strength of momentum of change. Signals can be given when the rate of change and the price level move in opposite directions.

 

Parameters: Period.

For additional help on what the different parameters mean, that isn't included on this page, click here.


Rate of Change

Rate of Change

Here is an example of the Rate of Change chart study (on a London Stock Exchange graph)


Reading the study:

Trade in the same way as Momentum. Look for divergence. If the rate of change is sloping downwards, while the price level is increasing, then this can be an indicator that a decline may be on the way, and vice versa.


Rate of Change

Rate of Change

Here is an example of the Rate of Change and the price line (of the London Stock Exchange), and what it may indicate




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