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NIFTY

10799.85      -17.85 -0.17%

BANK NIFTY

26409.30      -8.10 -0.03%
ACC 1300.40 (-0.13%) Link
Symbol     LTP Chng%
ICIL 76.85   + 13.01
JPASSOCIAT 15.40   + 6.57
GHCL 289.00   + 5.61
HINDPETRO 322.10   + 5.14
VAKRANGEE 43.25   + 4.98
Symbol     LTP Chng%
TAKE 280.20    -5.85
TORNTPOWER 240.50    -5.17
MANPASAND 149.85    -4.98
BHUSANSTL 35.70    -4.80
BAJAJHIND 7.15    -4.67
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Commodity Channel Index (CCI)

Introduction

The Commodity Channel Index, first developed by Donald Lambert, quantifies the relationship between the asset's price, a moving average (MA) of the asset's price, and normal deviations (D) from that average.

The CCI is very popular amongst technical investors; today's traders often use the indicator to determine cyclical trends in not only commodities, but also equities and currencies.

Formula

CCI = (Typical Price - 20-period SMA of TP) / (0.015 * Mean Deviation)
Typical Price (TP) = (High + Low + Close)/3
Constant = .015

Advantage

CCI measures the difference between a security's price change and its average price change. High positive readings indicate that prices are well above their average, which is a show of strength. Low negative readings indicate that prices are well below their average, which is a show of weakness. The Commodity Channel Index (CCI) can be used as either a coincident or leading indicator.

Sample Calculation

Technical chart for CCI

Technical Indicators

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