Usage of the Commodity Channel Index Indicator

The Commodity Channel Index (CCI) indicator helps to notice when the market is at the overbought or oversold level.

If the value of the CCI is lower than -100, the market is at the oversold level. In this case it is reasonable to open buy positions once the value of the indicator leaves this range.

If the value of the CCI is higher than +100, the market is at the overbought level . When the value of the indicator falls below +100, it is reasonable to open sell positions.