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DeMark's DeMarker I

The TD DeMarker I is designed to overcome the common shortcomings of traditional overbought / oversold indicators. The DeMarker I helps identify potential price bottoms and tops by making price comparisons from one bar to the next and measuring the level of price demand.

Interpretation

www.cmsfx.comTD DeMarker I should be interpreted as other overbought / oversold indicators such as RSI with the levels of 30 and 70. Signals can be generated using various methods:

Identifying Overbought/oversold Conditions: Looking for extreme overbought or oversold conditions. These levels essentially correspond to the common 70/30 levels used with the RSI indicator.

Trendlines: Drawing trendlines between peaks or troughs created by the DeMarker I, signals could be generated as the indicator breaks above/below the trendlines.

Divergence: Looking for divergence between the DeMarker I and the instrument's price may also be a viable strategy as it often is with other similar oscillators.

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