Customer Support : 020-61923200, [email protected] | Call and Trade : 020-61923220
Creator: Definedge
A candle consist of body and shadows. A candle’s body represents a trend, while its shadow represents volatility.
Candles with a high range and a high body show a strong trend. In contrast, a candle with a large range and a small body indicates a highly volatile session.
The volatility indicator calculates the range of the stock over a period. However, it is important to understand whether there are strong body candles or shadows during the period.
Shadow Rate Indicator (SRI) calculates the percentage of shadows and combines it with volatility. SRI indicator shows the rate of shadows compared to the volatility.
A higher SRI indicator shows a higher rate of volatility. A lower SRI indicator indicates that the trend is strong and bullish. Usually, SRI indicator will rise and remain above the average line during bearish trends.
The indicator table value in TradePoint & RZone also provides you with a list of all values of this indicator for any group of stocks. This will allow you to compare the readings of this indicator across different stocks.
The indicator is applicable to all types of charting. Calculated based on the number of columns on P&F charts, bricks on Renko charts, lines on Line-break charts, candles on Heikin ashi charts, and lines on Kagi charts. While the formula and reading of the indicators remain the same, they become more dynamic on these charts.
This indicator is also available in the System Builder of RZone & TradePoint for all charting methods. Using the system builder, you can develop various strategies based on the different conditions already present in this indicator. Additionally, it can be used with other indicators or price patterns to develop effective trading strategies. For any group of stocks and market segments, you can scan and backtest stocks based on those strategies.