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Creator: Definedge
The X Ratio indicator is a point-and-figure chart indicator developed by Prashant Shah.
The indicator is designed using the X, O, and vertical column properties of the Point & Figure chart.
X Ratio Indicator calculates the strength and momentum of a bullish trend.
An “X” represents a bullish print on a P&F chart, whereas an “O” represents a bearish print. Thus, this indicator is a price-based indicator plotted on a chart.
Using the indicator, the number of “Xs” and “Os” in the pattern is calculated, and the ratio of bullish prints is displayed below the price chart.
The green line in the indicator represents the X ratio and the red line represents its average. It indicates that the bulls are dominating the market and the uptrend is strong when the X ratio line is above its average line. If the X ratio line is below its average line, the bulls are losing strength.
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.
This indicator is also available in the System Builder of RZone & TradePoint. 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.